Per Equity Share of Rs.10:

* Figures are stated as per the Annual Report of 2011-12

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DIRECTORS’ REPORT & MANAGEMENT DISCUSSION AND ANALYSIS

To the Members, Your Directors are pleased to present their 87th report on the business and operations of your Company together with the Audited Statement of Accounts for the year ended March 31, 2012. 1. CORPORATE OVERVIEW Raymond Limited is India’s Leading Textile and Branded Apparel Company with interests in Engineering (files, tools and auto components) business having its corporate headquarters in Mumbai. Your Company prepares its financial statements in compliance with the requirements of the Companies Act, 1956 and the Generally Accepted Accounting Principles (GAAP) in India. Overall the financial statements have been prepared on historical cost basis. The estimates and judgments relating to the financial statements are made on a prudent and reasonable basis, so as to reflect in a true and fair manner the form and substance of transactions and reasonably present your Company’s state of affairs, profit and cash flows for the year ended March 31, 2012. 2. FINANCIAL HIGHLIGHTS FY 2012 witnessed a turbulent business environment that moderated growth. The year started with optimism but as it progressed, there were challenges with inflation, decelerating growth and worsening investment climate which adversely impacted consumer sentiments. The global economic environment was confronted with geo-political instability, Eurozone sovereign debt crisis, fluctuating global commodity prices, etc. In FY 2012, your Company reported a top-line growth of about 25% over the previous year. This growth was driven on multiple platforms including a powerful brand portfolio, pan-India retail network, strength of network relationships, product innovation and world class quality. Your Company’s investments in putting in place a structure to deliver on the strategy and improve operational processes are witnessing good traction. The FY 2012 performance of your Company is particularly noteworthy when viewed in the backdrop of an extremely challenging business environment especially during the second half of the year which is the peak season for textiles and apparel. During the year under review, your Company launched its flagship store ‘Raymond @ Warden Road’ in South Mumbai. This store has contemporary retail and merchandising elements designed to offer customers with the entire range of exotic & premium fabrics, apparel and accessories in a world class ambience. In February 2012, Ring Plus Aqua Limited, the auto components subsidiary of your Company, acquired a majority stake in a Pune-based forged components manufacturer. This acquisition marks Ring Plus Aqua’s entry into forged components and strengthens this subsidiary’s position in the global automotive power train domain. The Gross Consolidated revenue from operations for the FY 2012 was Rs. 3708.70 crore (Previous Year: Rs. 3064.05 crore). The Operating Profit was Rs.204.39 crore (Previous Year: Rs.197.17 crore). The Consolidated Profit after tax for the year was Rs.143.01 crore (Previous Year: Rs. 42.61 crore). The Standalone gross revenue from operations of your Company was Rs. 1874.63 crore as compared to Rs. 1496.53 crore in the previous year. The Operating Profit before tax and an exceptional item was Rs. 83.74 crore as against Rs. 98.54 crore in the previous year. The net profit after exceptional items, prior year adjustments and provision for taxes was Rs. 56.35 crore as against a net loss of Rs.100.19 crore in the previous year. Your Company focuses on enhancing shareholder value and looks beyond immediate opportunities by building its businesses with long-term relevance. Appropriation Your Directors recommend a dividend of 25% aggregating to Rs. 15.35 crore (Previous Year: Rs. 6.14 crore). The dividend distribution tax on the recommended dividend amounts to Rs. 2.49 crore (Previous Year: Rs. 1.00 crore). An amount of Rs. 5.63 crore (Previous Year: Nil) is credited to General Reserves and the surplus of Rs. 32.88 crore is carried to the Balance Sheet. 3. OVERVIEW OF THE ECONOMY Global growth is projected to be 3.5% for current year 2012. US economy is expected to continue its slow recovery, whilst the Eurozone grapples with its debt-crisis. Notwithstanding the current economic environment, there are strong reasons to be bullish on the country’s long term growth potential. Favourable demographics, a large growing middle class with increasing disposal incomes support a strong consumption story. 4. ANALYSIS AND REVIEW Textile Industry Conditions The Textile Industry is one of the most important sectors in the Indian Economy and the second largest generator of employment after Agriculture. It contributes more than 4% to the GDP and 17% to the country’s export earnings. The Textile sector provides employment to over 3.5 crore people.

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The Government proposes to increase the investment in this sector to generate more employment through various schemes viz. Scheme for Integrated Textile Parks (SITP), Technology Upgradation Fund Scheme (TUFS), Integrated Skill Development Scheme (ISDS), Technology Mission on Technical Textiles (TMTT). The allocation for this sector during the 12th Five Year Plan is proposed to be increased to around Rs. 49,650 crore as against an allocation of Rs. 14,000 crore during the11th Five Year Plan.

Opportunities and Challenges

Your Company is well poised to seize opportunities available to the textile and apparel sector on account of its brands resilience, strong domain expertise, state-of-the-art production facilities, emphasis on product innovation and growth potential in smaller towns & cities.

There are challenges, which in the short term, will moderate growth – inflation, high interest rates, depreciating rupee, delays in policy initiatives to boost investments and capital flows. These are likely to affect your Company’s performance.

Performance Highlights

Despite the challenging business environment and weak market sentiments especially during the second half of the year, which is the peak season for textiles and apparel industry in the country, the Company’s sales from the Textile Division registered a growth of 23%; the Net Revenue beng Rs. 1864.61 crore in FY 2012 as against Rs. 1485.43 crore in FY 2011.

Market Share and Retail Network

Your Company is the market leader in India for high quality clothing, both fabric and apparel in FY 2012. The Company continues its focus on retail network expansion during this financial year. The Company is operating through more than 800 retail stores which include TRS (The Raymond Shop) and EBOs (The Exclusive Brand Outlet) covering more than 1.6 million sq. feet of dedicated retail space (including overseas). The Company’s Brands are available across 30,000 plus, points of sale.

In FY 2012, the Textile Division’s domestic sales were Rs. 1668.91 crore as compared to Rs. 1349.03 crore in FY 2011. During FY 2012, your Company opened 100 TRS stores. The Company continues to be prudent in its selection of store locations.

Exports

Your Company has shown a remarkable growth of 44% during FY 2012. The Textile Exports during the year under review were Rs. 195.70 crore as against Rs. 136.40 crore in the previous year.

Raw Material

Wool prices remained high for the better part of the year under review and the depreciation of the rupee made wool imports costlier. Polyester fibre prices have been volatile but have ended soft during the year.

5. FINANCE AND ACCOUNTS

The observations made by the Auditors in their Report have been clarified in the relevant notes forming part of the Accounts, which are self-explanatory. The Schedule VI of the Companies Act, 1956 has been revised by the Ministry of Corporate Affairs vide its notification dated February 28, 2011. The notification is in force and is applicable for all Balance Sheets and Statement of Profit and Loss to be prepared for the financial year commencing on or after April 1, 2011. Therefore, the previous period figures have been regrouped/re-cast wherever necessary.

6. PERFORMANCE OF SUBSIDIARY COMPANIES

Domestic subsidiaries

Raymond Apparel Limited

The gross revenue of the company was at Rs. 568.82 crore (Previous Year: Rs. 468.79 crore). Profit after tax was Rs. 29.24 crore (Previous Year: Rs. 22.64 crore). The second half of FY 2012 was challenging due to subdued consumer sentiments. The strength of its brands enabled it to post topline growth of 21.34%. The strategy to stay focussed on core brands-Park Avenue, Parx & Raymond Premium Apparel is paying off.

Colorplus Fashions Limited

The company’s gross revenue for FY 2012 was Rs. 194.82 crore (Previous Year: Rs. 172.37 crore). The company had a profit after tax of Rs. 6.72 crore (Previous year: Rs. 10.38 crore). This company continues to innovate and adapt to latest fashion trends and is a leading player in the premium casual wear segment.

Silver Spark Apparel Limited

The gross revenue of the company for FY 2012 was Rs. 149.93 crore as compared to the previous year Rs. 110.18 crore. The company had a profit after tax of Rs. 8.78 crore (Previous Year: Rs. 5.62 crore).

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Celebrations Apparel Limited

The gross revenue of the company for FY 2012 was Rs. 24.76 crore (Previous Year: Rs.17.44 crore). The company earned a profit after tax of Rs. 1.06 crore (Previous Year: Rs.0.68 crore).

Everblue Apparel Limited

The company earned a profit after tax of Rs.1.01 crore (Previous Year: Rs. 0.76 crore).

Raymond Woollen Outerwear Limited

The gross revenue of the company, net of returns and discounts for FY 2012 was Rs. 16.59 crore (Previous Year: Rs. 50.58 crore). During this year company incurred loss of Rs. 8.14 crore (Previous Year: Rs.4.35 crore).

Your Company is in the process of seeking necessary legal approvals for the restructuring of this subsidiary. The restructuring is aimed at enhancement of operational efficiencies.

JK Files (India) Limited

The company continues to be the market leader in the files segment in the domestic market and the largest producer of Steel Files in the world. To diversify the product protfolio, power tools have been launched in the domestic market by the company.

The export sale of the company was Rs. 134.74 crore as compared to Rs. 98.94 crore in the previous year, a growth of 36.18%. The company reported gross revenue of Rs. 343.06 crore for the year under review (Previous Year: Rs. 272.12 crore). The profit after tax was Rs. 12.03 crore (Previous Year: Rs. 10.91 crore).

The company continues its initiatives on expanding capacity to cater to the increased demand for files, improving productivity, quality, controlling cost, optimum capacity utilization, better working capital and foreign exchange management. An extensive brand building exercise has been initiated by the Company.

JK Talabot Limited

The company manufactures files and rasps at its plant at Chiplun in Ratnagiri District, in the State of Maharashtra. During the year the gross revenue of the company was at Rs. 23.82 crore (Previous Year: Rs. 21.66 crore). The company recorded profit after tax of Rs. 2.02 crore during the FY 2012 (Previous Year: Rs. 1.43 crore).

Scissors Engineering Products Limited

The company incurred a loss of Rs.0.005 crore during the year under review (Previous Year: Rs.0.004 crore).

Ring Plus Aqua Limited

The total revenue of the company was at Rs. 152.99 crore (Previous Year: Rs.117.08 crore), a growth of 31%. The Net Profit after tax was at Rs. 12.64 crore (Previous Year: Rs. 11.29 crore) a growth of around 17%. With significant growth trend in the Auto Industry, the company for the first time crossed the milestone of total revenue of Rs.150 crore during the year under review.

The company continued its relentless efforts in developing new markets and acquiring new clients which lead to exponential growth in both domestic and export markets.

Trinity India Limited

The company was acquired by Ring Plus Aqua Limited on February 23, 2012, by purchase of majority stake. The company is a forged components manufacturer in Pune with a strong presence in the domestic and export markets. Ring Plus Aqua Limited has taken measures to improve the operations of the company.

Pashmina Holdings Limited

The company made a profit after tax of Rs. 0.36 crore in the FY 2012 as compared to Rs.1.99 crore in the previous year.

Overseas subsidiaries

Jaykayorg AG recorded a loss of CHF (174,474) (equivalent to Rs.0.95 crore) [Previous Year: Profit CHF 240,318 (equivalent to Rs. 1.15 crore)] for the year ended December 31, 2011.

R & A Logistics INC, USA, a subsidiary of Ring Plus Aqua Limited set up in USA to provide better service to US based customers, earned a profit of US$ 17,825 (equivalent to Rs. 0.09 crore) [Previous Year: US$ 11,111 (equivalent to Rs.0.04 crore)] for the year ended March 31, 2012.

7. PERFORMANCE OF JOINT VENTURES

Raymond UCO Denim Private Limited

During the year under review, the revenue from Indian operations, net of returns and discounts recorded a 26% growth to Rs. 750.48 crore including exports of Rs.290.90 crore, from Rs. 596.96 crore including exports of Rs. 263.44 crore for the FY 2011.

The company recorded a profit before tax and exceptional items of Rs. 14.02 crore as against a profit of Rs. 6.18 crore in FY 2011.

The company focused on improving high margin business and strategically exited non-remunerative price points. The measures of de-bottlenecking the manufacturing process also helped to improve productivity, efficiencies and reduce rejections.

Raymond Zambaiti Limited

The gross revenue of the company was Rs. 228.98 crore (Previous Year: Rs. 211.76 crore). The company had a profit after tax of Rs. 3.49 crore during the year under review (Previous Year: Rs. 7.51 crore).

The company is a preferred premium high value shirting supplier to top domestic brands and maintains its cutting-edge with continuous design and product innovation and a strong emphasis on consumer services. During the year under review this company’s operations were impacted with the introduction of excise duty on garments and low off-take by leading brands.

8. QUALITY & ACCOLADES

Your Company continues to win awards year-on-year. Some notable awards during the year are:

• In a survey conducted by FORTUNE Magazine along with HAY Group published in March 2012, Raymond Limited has been ranked 15th amongst India’s Most Admired Companies and No.1 in the Apparel Sector.

• Silver Spark Apparel Limited has won the following awards this year:

1) Highest unit value exporter for FY 2008-09 & FY 2009-10; and

2) Highest exports in woollen garments for FY 2008-09 & FY 2009-10.

9. CONSOLIDATED ACCOUNTS

In accordance with the requirements of Accounting Standard (AS) 21 prescribed by The Institute of Chartered Accountants of India, the Consolidated Accounts of the Company and its Subsidiaries (including the Joint Ventures) is annexed to this Report.

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10. CORPORATE GOVERNANCE

Your Company continues to be committed to good Corporate Governance aligned with good practices. Your Company is in compliance with the standards set out by Clause 49 of the Listing Agreement with the Stock Exchanges. A separate Report on Corporate Governance along with the Auditors’ Certificate on compliance with the Corporate Governance as stipulated in Clause 49 is set out in this Annual Report and forms part of this Report. 11. DIRECTORS In accordance with the provisions of the Companies Act, 1956 and the Company’s Articles of Association, Shri P. K. Bhandari, Shri I. D. Agarwal and Shri Pradeep Guha, Directors, retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. The Board at its meeting held on July 29, 2011, appointed Shri H. Sunder as an Additional Director who will hold office as Director up to the date of the forthcoming Annual General Meeting. A notice in writing has been received from a member of the Company under Section 257 of the Companies Act, 1956, signifying his intention to propose Shri H. Sunder as a candidate for the office of Director of the Company. In the said Board Meeting held on July 29, 2011, the Board had, subject to the approval of shareholders in the forthcoming General Meeting, appointed Shri H. Sunder, as Whole-time Director of the Company for a term of five years effective from July 29, 2011 to July 28, 2016. On the recommendations of the Nomination and Remuneration Committee the Board has fixed the remuneration of Shri H. Sunder for a period of three years. Your Directors commend the resolutions for the appointment and payment of remuneration of Shri Sunder for your approval. 12. DIRECTORS’ RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 217 (2AA) of the Companies Act, 1956: (i) that in the preparation of the Annual Accounts for the year ended March 31, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; (ii) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2012 and of the profit of the Company for the year ended on that date; (iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and (iv) the annual accounts have been prepared on a going concern basis. 13. AUDIT Messrs. Dalal & Shah, Chartered Accountants, who are Statutory Auditors of the Company hold office up to the forthcoming Annual General Meeting and are recommended for re-appointment to audit the accounts of the Company for the Financial Year 2012-13. As required under the provisions of the Section 224 (1B) of the Companies Act, 1956, the Company has obtained written confirmation from Messrs. Dalal & Shah that their appointment if made would be in conformity with the limits specified in the Section. As per the requirement of Central Government and pursuant to Section 233B of the Companies Act, 1956, your Company carries out an audit of cost records relating to Textile Division every year. Subject to the approval of the Central Government, the Company has appointed Messrs. R. Nanabhoy & Co., Cost Accountants, as Cost Auditors to audit the cost accounts of the Company for the Financial Year 2012-13. The cost audit report for the Financial Year 2010–11 which was due to be filed with the Ministry of Corporate Affairs on September 30, 2011 was filed on August 16, 2011. 14. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY Your Company believes in formulating adequate and effective internal control systems and implementing the same to ensure that assets and interests of the Company are safeguarded and reliability of accounting data and accuracy are ensured with proper checks and balances. The Internal control system is improved and modified continuously to meet the changes in business conditions, statutory and accounting requirements. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal control system and suggests improvements for strengthening them. The Company has a robust Management Information System which is an integral part of the control mechanism. The Audit Committee of the Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken.

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15. RISK MANAGEMENT

The Company is exposed to risks from market fluctuations of foreign exchange, interest rates, commodity prices, business risk, compliance risks and people risks.

Foreign Exchange Risk

The Company’s policy is to actively manage its long term foreign exchange risk within the framework laid down by the Company’s forex policy approved by the Board. Interest Rate Risk

Given the interest rate fluctuations, the Company has adopted a prudent and conservative risk mitigating strategy to minimise the interest costs.

Commodity Price Risk

The Company is exposed to the risk of price fluctuation on raw materials as well as finished goods in all of its products. The Company proactively manages these risks in inputs through forward booking, inventory management, proactive management of vendor development and relationships. The Company’s strong reputation for quality, product differentiation and service, the existence of a powerful brand image and a robust marketing network mitigates the impact of price risk on finished goods. Risk Element in Individual Businesses Apart from the risks on account of interest rate, foreign exchange and regulatory changes, various businesses of the Company are exposed to certain operating business risks, which are managed by regular monitoring and corrective actions.

Compliance Risks The Company is exposed to risks attached to various statutes and regulations including the Competition Act, 2002. The Company is mitigating these risks through regular reviews of legal compliances, through internal as well as external compliance audits. People Risks

Retaining the existing talent pool and attracting new manpower are major risks. The Company has initiated various measures such as rollout of strategic talent management system, training and integration of learning activities. The Company has also established ‘Raymond Leadership Academy’ which helps to identify, nurture and groom managerial talent within the Raymond Group to prepare them as future business leaders.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company has an innate desire and zeal to contribute towards the welfare and social upliftment of the community. The Company continues to support the following CSR initiatives: • Smt. Sulochanadevi Singhania School at Thane, Maharashtra and Kailashpat Singhania High School in Chhindwara, M.P., having overall strength of around 7700 students, run by the Company, provide quality education not only to the Raymond employees’ children, but also to the children of the local populace; • Raymond Embryo Research Centre for cattle is a centre set up at Gopalnagar, Bilaspur in Chhattisgarh and its ceaseless efforts and endeavours have made several significant achievements in Embryo Transfer. Raymond was the first organisation in India to introduce Embryo Transfer in Sheep; • J. K. Trust Gram Vikas Yojana (JKTGVY) launched in 1997 helps transfer of the technical expertise gained over three decades to the grass-root level. The mission of this initiative is to significantly improve the quality of life in India’s rural areas through a “Cattle Breed Improvement Programme”. This initiative operates in a network of 4549 Integrated Livestock Development Centre in, Bihar, Gujarat, Punjab, Haryana, Maharashtra, Chhattisgarh, Madhya Pradesh, and Andhra Pradesh. J. K. Trust Gram Vikas Yojana has become the largest NGO in animal husbandry sector in India.

• Raymond Rehabilitation Centre has been set-up for the welfare of under-privileged youth at Jekegram, Thane. This initiative enables less fortunate youth to be self-sufficient in life. The Centre provides free vocational training workshops to young boys over the age of 16. The three-month vocational courses comprise of basic training in electrical, air-conditioning & refrigeration, plumbing, etc. • Raymond Tailoring Academy will provide world class tailoring skills to tailors and help them to improve their income generating capacity. It will also attract the youth to take up this profession. 17. ENVIRONMENT AND SAFETY Your Company is conscious of the importance of environmentally clean and safe operations. Your Company’s policy requires the conduct of all operations in such manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

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18. HUMAN RESOURCES AND INDUSTRIAL RELATIONS

Your Company takes pride in the commitment, competence and dedication shown by its employees in all areas of business. Various HR initiatives are taken to align the HR Policies to the growing requirements of the business.

Your Company has a structured induction process at all locations and management development programmes to upgrade skills of managers. Objective appraisal systems based on Key Result Areas (KRAs) are in place for senior management staff.

Information pursuant to sub-section 1(e) of Section 217 of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure - 1 to this Report.

During the FY 2012 your Company had 8395 employees. 20 employees employed throughout the year, were in receipt of remuneration of Rs.60 lakh per annum or more amounting to Rs.2234.13 lakh and 1 employee employed for part of the FY 2012 was in receipt of remuneration of Rs.5 lakh per month or more amounting to Rs.32.92 lakh. The information required under Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 and forming part of the Directors’ Report for the year ended March 31, 2012 is given in a separate Annexure to this Report. The above Annexure is not being sent along with this Report to the Members of the Company in line with the provisions of Section 219 (1) (b) (iv) of the said Act. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by Members at the Registered Office of the Company 21 days before the 87th Annual General Meeting and upto the date of the ensuing Annual General Meeting during business hours on working days.

None of the employees listed in the said Annexure is a relative of any Director of your Company. None of the employees hold (by himself or along with his spouse and dependent children) more than two percent of the equity shares of the Company. As per Section 212 of the Companies Act, 1956, the Company is required to attach the Directors’ Report, Balance Sheet, and Profit and Loss account of subsidiaries. The Central Government has granted general exemption from complying with Section 212 of the Companies Act, 1956 to all companies vide Notification No. 5/12/2007-CL-III dated February 8, 2011. Accordingly, your Company has presented in this Report, the consolidated financial statements of the holding company and all its subsidiaries, duly audited by the Statutory Auditors.

The Company has also disclosed in the Consolidated Balance Sheet the information required to be provided as per the aforesaid notification dated February 8, 2011. The Company will make available the audited annual accounts and related information of its subsidiaries, upon request by any of its shareholders. The annual accounts of the subsidiary companies will also be kept for inspection, by any member at the Registered Offices of the Company and its subsidiary companies. The Company has not accepted any deposits, within the meaning of Section 58A of the Companies Act, 1956 read with the Companies (Acceptance of Deposits) Rules, 1975 made thereunder.

20. CAUTIONARY STATEMENT

Statements in this Directors’ Report & Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations or predictions may be “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include raw material availability and prices, cyclical demand and pricing in the Company’s principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries in which the Company conducts business and other incidental factors. 21. APPRECIATION

Your Directors wish to place on record their appreciation for the contribution made by employees at all levels but for whose hard work, solidarity, and support your Company’s achievements would not have been possible. Your Directors also wish to thank its customers, dealers, agents, suppliers, joint venture partners, investors and bankers for their continued support and faith reposed in the Company. For and on behalf of the Board

Gautam Hari Singhania

Mumbai, April 25, 2012 Chairman and Managing Director

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ANNEXURE - 1 TO THE DIRECTORS’ REPORT

Information pursuant to Section 217(1)(e) of the Companies Act, 1956, read with Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988. A. Conservation of Energy: Energy conservation continued to have high prominence as in previous years. Some of the initiatives taken in the FY 2012 were as follows: In Textiles Division At Chhindwara Unit: 1) Installation of Variable Frequency Drives (VFD) on TFO Machines. 2) Replacement of Electrical Heater with Steam Heater in Yarn Steaming Machine. 3) Replacement of inefficient motors by energy efficient motors at various places. 4) Conversion of DC-drive to AC-drive Warping Machine. 5) Replacement of 36 Watt Tube Light fittings by 28 Watt T-5 Tube Light fitting. 6) Replacement of old inverters – 15 Nos. for supply & return Air Fan in humidification. At Jalgaon Unit: 1) Power saving in compressed air consumption by installation of air pressure booster for machine requiring high pressure for their operation (Reduced pressure setting of compressor by 0.8 Bar). 2) Stopping of Chillers in winter season to optimize the power consumption. At Vapi Unit: 1) Installation of Inverter at Air Washer Tower. 2) Replacement of old Cooling Towers with energy efficient Cooling Tower. 3) Stopping of Chillers in winter season. B. Technology Absorption: (a) Research & Development (R & D): The R & D Department of the Textile division continues to develop new products for both domestic and export market. The major developments during the year are as under: 1. IMPRESSIONS is an exquisite collection of fabrics specially crafted using precious fibers like Yak, Llama, Guanaco, Cashmere, Yangi, Silk and more. 2. Estivo - Range of finest Linens and cotton fabrics for discerning customers. 3. BOLZANO - Collection of fine suiting fabrics made from super 80s merino wool and polyester in classic yet contemporary designs. 4. NEO CLASSIC - New offering of soft and pliable fabric for round the year wear. 5. CELATO - Range of lustrous fabrics for round the year wear. The detail of expenditure on Research & Development is given in this Report. The company has incurred an expenditure of Rs 27.98 lakh towards Research & Development which is 0.01 per cent of the total turnover of the company for the FY 2012. (b) Technology Absorption, adaption and Innovation: 1. Implementation of Warehouse management system resulting in faster locating of stock in warehouse resulting in speedy delivery. 2. Implementation of Theory of Constraints (TOC) which increased the throughput of the plant. 3. Installation of Real Time Process Diagnostic System in production has given improved data on quality parameters. 4. Optimizing the space requirement in warehouse by implementation of mezzanine floor. 5. Fully integrating the dyeing machines with color dispensing system to reduce the manual handling of dyes and chemicals and optimize the color and chemicals. C. Foreign Exchange Earnings and Outgo: Textiles Division recorded exports of Rs.195.70 crore in comparison with the previous year to Rs. 136.40 crore.

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Form ‘A’ [Forming part of Annexure - 1] DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

B. CONSUMPTION PER UNIT OF PRODUCTION

Unit Standard (if any) Current Year Previous Year

Electricity Fabrics KWH/Metre - 3.926 3.934

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CORPORATE GOVERNANCE REPORT

COMPANY’S PHILOSOPHY Corporate Governance at Raymond is a rigorous and well-established framework that helps to manage the Company’s affairs in a fair, accountable and transparent manner. Responsible corporate conduct is integral to the manner that we conduct our business and our actions are governed by values and principles, which are reinforced across all levels within the Company. Your Company has evolved guidelines and best practices over the years to ensure timely disclosure of information regarding our financials, performance, product- offerings, distribution network and governance. Your Company’s governance was ranked No.16 amongst India Inc’s 50 most well governed companies in an independent survey published in the Fortune India Magazine (March 2012 edition). To succeed, maintain sustainable growth and create long-term value requires the highest standards of corporate discipline. Your Company continues to focus its resources, strengths and strategies to achieve the vision of becoming a global leader in Textiles, Apparel, Garmenting and Lifestyle Brands while upholding the Core values of Quality, Trust, Leadership and Excellence. Our Code of Business Conduct and Ethics, and the Charter–Business for Peace are an extension of our values and reflect our commitment to ethical business practices, integrity and regulatory compliances. The Company’s Corporate Governance philosophy is further strengthened through the Raymond Code of Conduct for Prevention of Insider Trading. The Company has in place a robust Information Security Policy that ensures proper and appropriate utilisation of Information Technology (IT) resources. COMPANY’S GOVERNANCE STRUCTURE The Corporate Governance structure at Raymond is as follows: 1. The Board of Directors: The Members of the Raymond Board with the permission of Chairman are free to bring up any matter for discussion at the Board Meetings and the functioning is democratic. The Board plays a key role in framing policies for ensuring and enhancing good governance. Besides its primary role of setting corporate strategies and goals and monitoring corporate performance, the Board directs and guides the activities of the Management towards achieving those corporate goals, seeks accountability with a view to achieve sustained and consistent growth aimed at adding value for its stakeholders. 2. Board Committee: The Board has constituted the following Committees viz; Audit Committee, Remuneration & Nomination Committee and Committee of Directors (which also acts as the Shareholders’/Investors’ Grievance Committee). Each Committee has been mandated to operate within a given framework. THE BOARD OF DIRECTORS Size and Composition of the Board The Board is broad-based and consists of eminent individuals drawn from industry, management, technical, financial, legal and marketing. The Board is entrusted with the ultimate responsibility of the management, general affairs, directions and performance of the Company. The Company is managed by the Board of Directors in coordination with the Senior Management team. The current policy is to have an appropriate mix of executive, non-executive and independent directors to maintain the independence of the Board, and to separate the functions of governance and management. Currently the Board consists of ten members, two of whom are executive, one is non-executive and seven are independent directors. The Board periodically evaluates the need for change in its composition and size. The details of each member of the Board along with the number of Directorship/Committee Membership and date of joining the Board are provided in this report. Composition and Directorship/Committee Membership as on March 31, 2012 Name DIN Date of Directorship No. of Board Relationship Joining in other Committees inter-se the Board Indian public in which Directors companies Chairman/Member Chairman Member Chairman Emeritus 00020063 29/06/1971 6 Nil Nil Related to Shri Gautam Dr. Vijaypat Singhania Hari Singhania Chairman and Managing Director 00020088 01/04/1990 11 Nil 1 Related to Dr. Vijaypat Shri Gautam Hari Singhania Singhania Independent Directors Shri I. D. Agarwal 00293784 23/06/2006 1 Nil 1 - Shri Nabankur Gupta 00020125 15/01/2001 9 1 2 - Shri P. K. Bhandari 00021923 24/04/2003 10 Nil 4 - Shri Shailesh V. Haribhakti 00007347 15/06/2009 14 4 5 - Shri Pradeep Guha 00180427 15/06/2009 4 Nil Nil - Shri Akshay Chudasama 00010630 21/04/2011 4 Nil 3 - Shri Boman R. Irani 00057453 21/04/2011 Nil Nil Nil - Whole-time Director Shri H. Sunder 00020583 29/07/2011 8 Nil 7 - (Directorships exclude Alternate Directorship. Chairmanship/Membership of Committee only includes Audit Committee and Shareholders’ Grievance Committee.)

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As required by the Listing Agreement members of the Board do not have Directorships in more than fifteen Companies or a Member of more than ten Board-level Committees or Chairman of more than five such Committees. Board Meetings Board meetings are conducted in accordance with the Articles of Association of the Company. The Board meets at regular intervals to discuss and decide on business strategies/policies and financial performance of the Company and its subsidiaries. The Board Meetings are pre-scheduled and a tentative annual calendar of the board is circulated to all the Directors well in advance to facilitate them to plan their schedules. In case of business exigencies the Board’s approval is taken through Circular Resolutions. The Circular Resolutions are noted at the subsequent Board meeting. The notice of each Board Meeting is given in writing to each Director. The Agenda along with the relevant notes and other material information are sent in advance separately to each Director and in exceptional cases tabled at the meeting. This ensures timely and informed decisions by the Board. The Minutes of the Board Meetings are also circulated in advance to all Directors and confirmed at subsequent Meeting.The Board reviews the performance of the Company vis-à-vis the budgets/targets. In the Financial Year 2011-12, the board met five times on April 21, 2011, July 29, 2011, September 12, 2011, October 19, 2011 and January 18, 2012. Intervals between two meetings were well within the maximum period mentioned in the Listing Agreement. Attendance of Directors at the Board Meetings and at the last Annual General Meeting Sr.No. Name of Directors No. of Board Attendance at the AGM Meetings attended. held on June 07, 2011 1. Dr. Vijaypat Singhania, Chairman Emeritus 2 of 5 2. Shri Gautam Hari Singhania, Chairman and Managing Director 5 of 5 3. Shri I. D. Agarwal 4 of 5 4. Shri Nabankur Gupta 5 of 5 Leave sought 5. Shri P. K. Bhandari 4 of 5 Leave sought 6. Shri Shailesh V. Haribhakti 5 of 5 7. Shri Pradeep Guha 3 of 5 Leave sought 8. Shri Akshay Chudasama 5 of 5 Leave sought 9. Shri Boman Irani 4 of 5 10. Shri H. Sunder, 4 of 4 Not Applicable Whole-time Director (w.e.f. 29.07.2011) The Audit Committee Chairman, Shri Shailesh V. Haribhakti attended the last Annual General Meeting held on June 7, 2011. Board Business The Board’s business inter alia includes: Business strategies and direction to the Company. Corporate annual plan and operating framework. Corporate resource allocation. Quarterly business performance reports. Quarterly and annual financial reporting/announcements. Board remuneration policy. Recommendation of dividend. Convening Annual General meeting of shareholders. Annual review of accounts and ensuring adoption of the same by shareholders. Review of subsidiaries functioning. Review of Joint Ventures functioning. Mergers, Acquisitions, Joint Ventures, if any. Details on any Joint Ventures or collaboration agreements. Review of litigations, prosecutions, show cause notices, demands and penalty notices received. Significant developments in the human resources and industrial relations. Fatal accidents and other dangerous occurrences. Risk evaluation and control. Review details regarding foreign exchange exposure and steps implemented to manage them. Compliance with relevant legislations and regulations. Board Support The Company Secretary attends all the Board meetings and advises the Board on Compliances and governance of the applicable laws.

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Board Independence As per Listing Agreement entered with Stock Exchanges, the independence of the Directors meets with Clause 49. Based on the confirmation/disclosures received from the Directors, all non-executive Directors except Dr. Vijaypat Singhania are Independent. COMMITTEES OF THE BOARD The Board of Directors have constituted Board Committees to deal with specific areas and activities which concern the Company and need a closer review. The Board Committees are formed with approval of the Board and function under their respective Charters. These Board Committees play an important role in overall management of day-to-day affairs and governance of the Company. The Board Committees meet at regular intervals, takes necessary steps to perform their duties entrusted by the Board. To ensure good governance, the Minutes of the meetings are placed before the Board for their review. The Board has currently the following Committees: AUDIT COMMITTEE The Audit Committee of the Board of Directors (“the Audit Committee”) is entrusted with the responsibility to supervise the Company’s internal controls and financial reporting process.The composition, quorum, powers, role, scope, etc., are in accordance with Section 292A of the Companies Act, 1956 and the provisions of Clause 49 of the Listing Agreement. All members of the Audit Committee are financially literate and bring in expertise in the fields of Finance, Taxation, Economics, Risk and International Finance. Shri Shailesh V. Haribhakti, Chartered Accountant is the Chairman of the Audit Committee. The other members of the Audit Committee include Dr. Vijaypat Singhania, Shri Nabankur Gupta and Shri I. D. Agarwal. The Audit Committee inter-alia performs the functions of approving Annual Internal Audit Plan, Review of Financial Reporting System, Internal Controls System, discussion on quarterly, half-yearly and annual financial results, interaction with Statutory & Internal Auditors, meeting with Statutory and Internal Auditors, recommendation for the appointment of Statutory and Cost Auditors and fixing their remuneration, appointment and remuneration of Internal Auditors, Review of Business Risk Management Plan, Review of Forex policy, Management Discussions & Analysis, Review of Internal Audit Reports, significant related party transactions. The Company has framed the Audit Committee Charter for the purpose of effective compliance of Clause 49 of the Listing Agreement. In fulfilling the above role, the Audit Committee has powers to investigate any activity within its terms of reference, to seek information from employees and to obtain outside legal and professional advice. Additionally, the following terms of reference were issued to the Audit Committee by the Board of Directors: a) to consider and recommend to the Board the following: (i) investment guidelines for treasury operations; (ii) capital expenditure for enhancement of production capacity (excluding capital expenditure for normal maintenance/ repairs/replacements); b) to review the Annual Budget; c) to take note of the significant decisions taken or important developments considered at the Management Committee/Working Board Meetings; and d) to carry out any other duties that may be delegated to the Audit Committee by the Board of Directors from time-to-time. The Audit Committee, while reviewing the Annual Financial Statements also reviews the applicability of various Accounting Standards (AS) referred to in sub-section (3C) of Section 211 of the Companies Act, 1956. Compliance of the Accounting Standards as applicable to the Company has been ensured in the preparation of the Financial Statements for the year ended March 31, 2012. The Audit Committee bridges the gap between the Internal Auditors and the Statutory Auditors. To ensure good Governance, the Company has been rotating Partners of Statutory Auditors. The Statutory Auditors are responsible for performing Independent audit of the Company’s financial statements in accordance with the generally accepted accounting practices and issuing reports based on such audits, while the Internal Auditors are responsible for financial reporting and internal risk controls. Besides the above, Chairman and Managing Director, Chief Financial Officer, Business Heads of the Company’s Divisions, the representatives of the Statutory Auditors and the Internal Auditors are permanent invitees to the Audit Committee Meetings. The representatives of the Cost Auditor attend such meetings of the Audit Committee where matters relating to the Cost Audit Report are discussed. The Company Secretary acts as a Secretary to the Committee as required by Clause 49(II) (A) (vi) of the Listing Agreement of the Stock Exchanges. The Company follows best practices in financial reporting. The Company has been reporting on quarterly basis, the Standalone Financial Results as required by the Clause 41 of the Listing Agreement entered with Stock Exchanges. The Company has additionally, as a matter of good Governance, taken initiative in reporting the Consolidated Financial Results along with the Standalone Financial Results of the Company. Meetings and Attendance The Audit Committee met four times during the Financial Year 2011-12. The Company is in full compliance with the provisions of Clause 49 of the Listing Agreement. The Committee met on April 21, 2011, July 29, 2011, October 19, 2011 and January 18, 2012. The Table below provides the Attendance of the Audit Committee members. Sr. No. Name Position Category No. of Meetings attended 1. Shri Shailesh V. Haribhakti Chairman Independent, Non-Executive 4 of 4 2. Dr. Vijaypat Singhania* Member Promoter, Non-Executive 2 of 4 3. Shri Nabankur Gupta Member Independent, Non-Executive 4 of 4 4. Shri I.D. Agarwal Member Independent, Non-Executive 4 of 4 *Dr. Vijaypat Singhania could not attend 2 meetings due to illness.

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Internal Controls The Company has appointed a firm of Chartered Accountants as Internal Auditors to review the internal control systems of the Company and to report thereon. The report of the Internal Auditors is reviewed by the Audit Committee. The Audit Committee formulates a detailed plan to the Internal Auditors for the year and the same is reviewed at the Audit Committee meetings. The Internal Auditors submit their recommendations to the Audit Committee and provide a road map for future action. REMUNERATION AND NOMINATION COMMITTEE Terms of Reference The Board has clearly defined terms of reference for the Remuneration and Nomination committee, which are as follows: • Review the overall compensation policy, service agreements, ESOP Schemes and other employment conditions of Managing/ Whole-time Director(s) and Senior Management (one level below the Board of Directors); • Review the performance of the Managing/Whole-time Director(s)/Senior Management and recommending to the Board, the quantum of annual increments and annual commission; • Recommend the size and composition (including functional specialist) of the Board, establish procedures for the nomination process and recommend candidates for selection to the Board/nominate Whole-time Director(s); and • Structure and design a suitable succession planning policy for Board and Senior Management team of the Company. Composition and Attendance The Committee met three times during the Financial Year 2011-12. The composition and attendance of the members are given in the Table below: Sr. No. Name Position Category No. of Meetings attended 1. Shri I.D. Agarwal Chairman Independent, Non-Executive 3 of 3 2. Dr. Vijaypat Singhania Member Promoter, Non-Executive 2 of 3 3. Shri Gautam Hari Singhania Member Promoter, Executive 3 of 3 4. Shri Nabankur Gupta Member Independent, Non-Executive 3 of 3 5. Shri Pradeep Guha Member Independent, Non-Executive 1 of 3 6. Shri Shailesh V. Haribhakti Member Independent, Non-Executive 2 of 3 REMUNERATION POLICY A. Remuneration to Non-Executive Directors The Non-Executive Directors are paid remuneration by way of Commission and Sitting Fees. The Non-Executive Directors are paid sitting fees for each meeting of the Board or Committee of Directors attended by them. The total amount of sitting fees paid during the Financial Year 2011-12 was Rs.15.80 Lakh. None of the Non-Executive Directors have any material pecuniary relationship or transactions with the Company. B. Remuneration to Executive Directors The appointment of Executive Directors including Chairman and Managing Director and Whole-time Director is governed by the recommendation of the Remuneration & Nomination Committee, Resolutions passed by the Board of Directors and Shareholders of the Company, which covers the terms of such appointment and remuneration, read with the service rules of the Company. Payment of remuneration to Executive Directors is governed by the respective Agreements executed between them and the Company. The remuneration package of Chairman and Managing Director and Whole-time Director comprises of salary, perquisites and allowances, commission and contributions to Provident and other Retirement Benefit Funds as approved by the Shareholders at the General Meetings. Annual increments are linked to performance and are decided by the Remuneration Committee and recommended to the Board for approval thereof. The remuneration policy is directed towards rewarding performance, based on review of achievements. It is aimed at attracting and retaining high calibre talent. Presently, the Company does not have a scheme for grant of stock options or performance linked incentives for its Directors. DETAILS OF REMUNERATION PAID TO DIRECTORS FOR THE YEAR ENDED MARCH 31, 2012 (a) NON EXECUTIVE DIRECTORS Name of the Director Commission (`) Sitting Fees (`) No. of Shares held Dr. Vijaypat Singhania 6,00,000 1,40,000 83,097 Chairman Emeritus Shri I. D. Agarwal 6,00,000 2,20,000 Nil Shri Nabankur Gupta 6,00,000 4,80,000 Nil Shri P. K. Bhandari 6,00,000 3,40,000 3 Shri Shailesh V. Haribhakti 6,00,000 2,20,000 Nil Shri Pradeep Guha 6,00,000 80,000 Nil Shri Akshay Chudasama 6,00,000 1,00,000 Nil Shri Boman R. Irani* Nil Nil Nil *Shri Boman R. Irani has written to the Company mentioning that he will not receive any remuneration from the Company.

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(b) EXECUTIVE DIRECTORS

Name of the Director Salary (`) Benefits (`) Remarks Shri Gautam Hari Singhania 2,47,50,000 3,34,18,674 Appointment for a period of 5 years from Chairman and Managing July 1, 2009 to June 30, 2014 and remuneration Director for a period of 3 years.

Shri. H. Sunder Appointment for a period of 5 years from

Whole-time Director 23,45,716 1,13,71,201 July 29, 2011 to July 28, 2016 and remuneration for a period of 3 years. SHAREHOLDERS/ INVESTORS’ GRIEVANCE COMMITTEE The Board has constituted a Committee of Directors, which also functions as “Shareholders’/Investors’ Grievance Committee”, consisting of three members. COMPOSITION AND ATTENDANCE The Committee comprises of 3 Directors. Shri Nabankur Gupta, Non-Executive, Independent Director is the Chairman of this Committee. The table below highlights the composition and attendance of the Members of the Committee. Sr. No. Name of the Director Role Category No. of Meetings attended 1. Shri Nabankur Gupta Chairman Independent, Non-Executive 12 of 12 2. Shri Gautam Hari Singhania Member Promoter, Executive 11 of 12 3. Shri P. K. Bhandari Member Independent, Non-Executive 12 of 12 Terms of Reference of the Committee The Board has clearly defined the terms of reference for this committee, which generally meets once a month. The committee looks into the matters of Shareholder/Investors grievance along with other matters listed below: approval of transfer of shares/debentures and issue of duplicate/split/consolidation/sub-division of share/debenture certificates; opening/modification of operation and closing of bank accounts; grant of special/general Power of Attorney in favour of employees of the Company from time to time in connection with the conduct of the business of the Company particularly with Government and Quasi-Government Institutions; to fix record date/book closure of share/debenture transfer book of the Company from time to time; to appoint representatives to attend the General Meeting of other companies in which the Company is holding shares; to change the signatories for availment of various facility from Banks/Financial Institution; to grant authority to execute and sign foreign exchange contracts and derivative transactions; and to carry out any other duties that may be delegated to the Committee by the Board of Directors from time-to-time. The Secretarial Department of the Company and the Registrar and Share Transfer Agent, Link Intime India Private Limited attend to the grievances of the shareholders and investors received and through Regulatory Authorities. The Minutes of the Shareholders’/ Investors’ Grievance Committee Meetings are circulated to the Board and noted by the Board of Directors at the Board Meetings. Continuous efforts are made to ensure that grievances are more expeditiously redressed to the complete satisfaction of the investors. DETAILS OF SHAREHOLDERS’ COMPLAINTS RECEIVED, NOT SOLVED AND PENDING SHARE TRANSFERS The total number of complaints received and replied to the shareholders during the year ended March 31, 2012 was 131. There were nil complaints outstanding as on March 31, 2012. The number of pending share transfers and pending requests for dematerialization as on March 31, 2012 were Nil. Shareholders’/Investors’ complaints and other correspondence are normally attended to within seven working days except where constrained by disputes or legal impediments. No investor grievances remained unattended/pending for more than thirty days as on March 31, 2012. Sr. No. Nature of Complaints Complaints Complaints Received Redressed 1. Non-receipt of Dividend 72 72 2. Non-receipt of Shares lodged for Transfer 18 18 3. Non-receipt of Duplicate/Consolidated Share Certificates 18 18 4. Non-receipt of Demat Credit/ Remat requests 6 6 5. Others (e.g. Queries received from other Statutory Authorities, etc.) 17 17 Total 131 131

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COMPANY POLICIES

Code of Business Conduct & Ethics

The Company has adopted a Code of Business Conduct & Ethics (“the Code”) which is applicable to the Board of Directors and Senior Management Team (one level below the Board of Directors) of the Company. The Board of Directors and the members of Senior Management Team are required to affirm semi-annual Compliance of this Code. The Code requires Directors and Employees to act honestly, fairly, ethically, and with integrity, conduct themselves in professional, courteous and respectful manner. The Code is displayed on the Company’s website – www.raymond.in

Preventing Conflict of Interests

Members of Board and Senior Management Team while discharging their duties, avoid their conflict of interest in the decision making process. The members of Board refrain themselves from any discussions and voting in transactions where they have concern or interest.

Insider Trading Code

The Company has adopted a ‘Code of Conduct for Prevention of Insider Trading (“the Code”) in accordance with the requirements of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 with effect from October 1, 2002.

The Securities and Exchange Board of India (SEBI) has over the years introduced various amendments to the Insider Trading Regulations of 1992 which ordain new action steps by corporates and other market intermediaries for the purposes of prevention of Insider Trading. This Code is amended from time to time reflecting the changes brought in by SEBI in the Insider Trading Regulations. The said Code is applicable to all Directors and such Designated Employees who are reasonably expected to have access to unpublished price sensitive information relating to the Company. The Company Secretary has been appointed as the Compliance Officer for monitoring adherence to the Insider Trading Regulation/said Code.

AFFIRMATIONS AND DISCLOSURES:

a. Compliances with Governance Framework

The Company is in compliance with all mandatory requirements of Clause 49 of the Listing Agreement. In addition, the Company has also adopted the non-mandatory requirements of constitution of the Remuneration and Nomination Committee and tenure of office of Independent Directors.

b. Disclosure on materially significant related party transactions that may have potential conflict with the interests of the Company at large.

There are no materially significant related party transactions made by the Company with its Promoters, Directors, Senior Management, their subsidiaries or relatives etc., which may have potential conflict with the interests of the Company at large.

Transactions with related parties as per requirements of Accounting Standard (AS)18 – ‘Related Party Disclosures’ are disclosed in Note - 35 to the Financial Statements in the Annual Report.

c. Disclosure of Accounting Treatment

In the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 211(3) (c) of the Companies Act, 1956. The significant accounting policies which are consistently applied are set out in the Annexure - 1 to Notes to the Financial Statements.

d. Risk Management

Business risk evaluation and management is an ongoing process within the Company. During the year under review, a detailed exercise on ‘Risk Assessment and Management’ was carried out covering the entire gamut of business operations and the Board was informed of the same.

e. Details of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchanges or SEBI or any statutory authority, on any matter related to capital markets, during the last three Financial Years.

The Company has complied with all requirements of the Listing Agreements entered into with the Stock Exchanges as well as the regulations and guidelines of SEBI. Consequently, there were no strictures or penalties imposed by either SEBI or the Stock Exchanges or any statutory authority for non-compliance of any matter related to the capital markets during the last three years.

f. Non-mandatory requirements

Adoption of non-mandatory requirements of Clause 49 of the Listing Agreement is being reviewed by the Board from time-to-time.

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SHAREHOLDER INFORMATION GENERAL BODY MEETING DETAILS OF LAST THREE ANNUAL GENERAL MEETINGS HELD Sr. No. Financial Year Date and Time Venue Details of Special Resolution Passed 1. 2008-09 JUNE 10, 2009 REGISTERED OFFICE The payment of minimum remuneration in the 11.00 AM OF THE COMPANY AT RATNAGIRI absence/inadequate profits to: (a) Shri Gautam Hari Singhania, Chairman and Managing Director, for the period from April 01, 2008 to June 30, 2009, and (b) Shri P. K. Bhandari, Whole-Time Director for the period from April 1, 2008 to April 23, 2008. 2. 2009-10 JUNE 15, 2010 REGISTERED OFFICE No Special Resolution was passed at the meeting. 11.00 AM OF THE COMPANY AT RATNAGIRI 3. 2010-11 JUNE 07, 2011 REGISTERED OFFICE Payment of Commission out of the annual profits 11.00 AM OF THE COMPANY AT RATNAGIRI of the Company to Non-Executive Directors, a sum not exceeding 1% during the period from April 01, 2011 to March 31, 2014. EXTRA–ORDINARY GENERAL MEETING/POSTAL BALLOT There were no Extra-Ordinary General Meetings/Postal Ballot conducted during the Financial Year 2011-12. ANNUAL GENERAL MEETING 2012 DAY AND DATE Wednesday, June 06, 2012 TIME 11.00 AM VENUE (Registered Office of the Company) Plot No. 156/H. No. 2, Village Zadgaon, Ratnagiri, Maharashtra - 415 612. BOOK CLOSURE DATE FOR DIVIDEND May 18, 2012 to June 06, 2012 (both days inclusive) LAST DATE OF RECEIPT OF PROXY FORMS Monday, June 04, 2012 Tentative Calendar for Financial Year ending March 31, 2013 The tentative dates for Board Meetings for consideration of quarterly financial results is as follows: Sr. No. Particulars of Quarter Tentative dates 1. First Quarter Results In or before the Third week of July 2012. 2. Second Quarter & Half Yearly Results In or before the Third week of October 2012. 3. Third Quarter & Nine-months Results In or before the Third week of January 2013. 4. Fourth Quarter & Annual Results In or before the Third week of April 2013. Dividend The Board of Directors at their meeting held on April 25, 2012, recommended dividend payout, subject to approval of the shareholders at the ensuing Annual General Meeting of Rs. 2.50 per share, on equity shares of the Company for the Financial Year 2011-12. The Dividend shall be paid to the members whose names appear on Company’s Register of Members on June 06, 2012. Dividend History for the last 10 Financial Years The Table below highlights the history of Dividend declared by the Company in the last 10 Financial Years: Sr. No. Year of Declaration Date of Declaration Amount declared of Dividend of Dividend per share 1. 2001-02 June 24, 2002 Rs. 4.50 2. 2002-03 June 11, 2003 Rs. 4.50 3. 2003-04 June 30, 2004 Rs. 5.50 4. 2004-05 June 16, 2005 Rs. 4.00 5. 2005-06 June 23, 2006 Rs. 5.00 6. 2006-07 June 18, 2007 Rs. 5.00 7. 2007-08 June 18, 2008 Rs. 2.50 8. 2008-09 No Dividend Declared Nil 9. 2009-10 No Dividend Declared Nil 10. 2010-11 June 07, 2011 Re.1.00 Unclaimed Dividend/Share Certificates The unclaimed dividend for a period of seven years is compulsorily deposited in Investors Education and Protection Fund (IEPF) Account in accordance with Section 205C of the Companies Act, 1956 administered by the Central Government which cannot be claimed by the Shareholders/Investors.

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Details of Unclaimed Dividend and due dates for transfer are as follows: Sr. No. Year of Declaration Date of Declaration Unclaimed Amount Due Date for transfer of Dividend of Dividend as on 31-03-2012 (`) to IEPF Account. 1. 2004-05 June 16, 2005 18,79,388/- July 22, 2012 2. 2005-06 June 23, 2006 23,58,380/- July 29, 2013 3. 2006-07 June 18, 2007 26,69,110/- July 24, 2014 4. 2007-08 June 18, 2008 14,78,617/- July 24, 2015 5. 2008-09 No Dividend Declared N.A. N.A. 6. 2009-10 No Dividend Declared N.A. N.A. 7. 2010-11 June 07, 2011 9,20,162/- July 13, 2018 During the Financial Year under review, the Company has transferred Rs. 23,21,034/- to Investors Education and Protection Fund towards Unclaimed Dividend. As per Clause 5A of Listing Agreement, the Company has identified around 2375 folios comprising around 57,400 equity shares of the Company. The Company has sent a reminder at the addresses to the shareholders informing about the unclaimed Share Certificates. As required by Clause 5A, the shares will be transferred in demateralised form to the unclaimed Equity Shares account administered by the Company. Distribution of Shareholding as on March 31, 2012 No. of equityshares No. of shareholders % of shareholders No. of shares held % of Shareholding 1 to 500 114703 97.09 7808836 12.72 501 to 1000 2069 1.75 1503894 2.45 1001 to 2000 750 0.63 1057150 1.72 2001 to 3000 198 0.17 495725 0.81 3001 to 4000 89 0.07 317531 0.52 4001 to 5000 59 0.05 275291 0.45 5001 to 10000 112 0.10 781164 1.27 10001 and above 160 0.14 49141262 80.06 GRAND TOTAL 118140 100 61380853 100.00

Categories of Shareholders as on March 31, 2012

Sr. No. Category No of shares held % 1 Shareholding of Promoter and Promoter Group 2,42,60,337 39.52 2 Public shareholding A Institutions (a) Mutual Funds/UTI/Financial Institutions/Banks/Insurance Companies 1,65,09,898 26.90 (b) Foreign Institutional Investors 55,43,893 9.03 Sub-Total (A) 2,20,53,791 35.93 B Non-institutions (a) Bodies Corporate & Trusts 18,78,153 3.06 (b) Individuals 1,23,44,060 20.11 Sub-Total (B) 1,42,22,213 23.17 3 Shares underlying Global Depository Receipts 8,44,512 1.38 GRAND TOTAL 6,13,80,853 100.00 DEMATERIALISATION OF SHARES AND LIQUIDITY 95.57% of the equity shares of the Company have been dematerialised (NSDL - 91.17% and CDSL 4.40%) as on March 31, 2012. The Company has entered into agreements with both National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) whereby shareholders have an option to dematerialise their shares with either of the Depositories. RECONCILIATION OF SHARE CAPITAL AUDIT REPORT As stipulated by SEBI, a qualified Practicing Company Secretary carries out Secretarial Audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. This audit is carried out every quarter and the report thereon is submitted to the Listed Stock Exchanges. The audit confirms that the total Listed and Paid-up Capital is in agreement with the aggregate of the total number of shares in dematerialised form (held with NSDL and CDSL) and total number of shares in physical form.

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Top 10 Shareholders as on March 31, 2012 other than Promoter/Promoter Group

Outstanding GDRs/Warrants and Convertible Bonds, conversion date and likely impact on equity: There were 4,22,256 outstanding GDRs representing 8,44,512 equity shares, 1.38% of the total Share Capital as on March 31, 2012. GDRs were issued in full, representing 2 underlying Equity shares. The total number of outstanding equity shares of the Company remain constant. The Company’s GDRs are Listed on the Luxembourg Stock Exchange.

MEANS OF COMMUNICATION TO SHAREHOLDERS

(i) The Board of Directors of the Company considers and approves all quarterly and annual financial results in the Pro-forma prescribed by Clause 41 of the Listing Agreement within one month of the close of the respective period. (ii) The approved financial results are forthwith sent to the Stock Exchanges where the Equity Shares of the Company are Listed and are published in a English national daily newspaper. In addition, the same are published in a local language (Marathi) newspaper, within forty-eight hours of approval thereof. Presently the same are not sent to the shareholders separately. (iii) The Company’s financial results and official press releases are displayed on the Company’s Website- www.raymond.in (iv) Any presentation made to the institutional investors and analysts is also posted on the Company’s website. (v) Management Discussion and Analysis forms part of the Annual Report, which is sent to the Shareholders of the Company. Share Transfer System: The transfer of shares in physical form is processed and completed by Registrar & Transfer Agent within a period of seven days from the date of receipt thereof provided all the documents are in order. In case of shares in electronic form, the transfers are processed by NSDL/CDSL through respective Depository Participants. In compliance with the Listing Agreement with the Stock Exchanges, a Practicing Company Secretary carries out audit of the System of Transfer and a certificate to that effect is issued. Nomination: Individual shareholders holding shares singly or jointly in physical form can nominate a person in whose name the shares shall be transferable in the event of death of the registered shareholder(s). Nomination facility in respect of shares held in electronic form is also available with the Depository Participants as per the bye-laws and business rules applicable to NSDL and CDSL. Nomination forms can be obtained from the Company’s Registrar and Share Transfer Agent. Electronic Clearing Service: The Securities and Exchange Board of India (SEBI) has made it mandatory for all companies to use the bank account details furnished by the Depositories for depositing dividends. Dividend will be credited to the Members’ bank account through NECS wherever complete core banking details are available with the Company. In case where the core banking details are not available, dividend warrants will be issued to the Members with bank details printed thereon as available in the Company’s records. This ensures that the dividend warrants, even if lost or stolen, cannot be used for any purpose other than for depositing the money in the accounts specified on the dividend warrants and ensures safety for the investors. The Company complies with the SEBI requirement. Service of documents through electronic mode: As a part of Green Initiatives, the members who wish to receive the notice/documents through e-mail, may kindly inform their e-mail addresses to the Company’s Registrar and Share Transfer Agent, Link Intime India Private Limited, to their dedicated e-mail ID i.e., “raymond@linkintime.co.in.” Address for Correspondence: Compliance Officer Link Intime India Pvt. Ltd. Demat Shares Correspondence with the Company Shri Thomas Fernandes Unit: Raymond Limited Respective Depository Raymond Limited, Director-Secretarial & C-13, Pannalal Silk Mills Compound, Participants of the Share Department, Company Secretary L.B.S Marg, Bhandup (West), Shareholder Pokhran Road No.1, Jekegram, Phone: 022-61527000 Mumbai – 400 078 Thane (W) 400606. E-mail: thomas.fernandes@raymond.in Phone : 022-25946970 Phone: 022- 61528687/8619 022-25963838 Fax : 022-25382912/022-25412805 Fax : 022-25946969 E-mail: bhaskar.acharya@raymond.in E-mail: raymond@linkintime.co.in rnt.helpdesk@linkintime.co.in

COMPLIANCE CERTIFICATE OF THE AUDITORS:

The Statutory Auditors have certified that the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement with the Stock Exchanges and the same is annexed to this Report. The Certificate from the Statutory Auditors will be sent to the Listed Stock Exchanges along with the Annual Report of the Company.

DECLARATIONS Compliance with the Code of Business Conduct and Ethics As provided under Clause 49 of the Listing Agreement with the Stock Exchanges, all Board members and Senior Management Personnel have affirmed compliance with Raymond Limited Code of Business Conduct and Ethics for the Financial Year ended March 31, 2012. For Raymond Limited Gautam Hari Singhania Chairman and Managing Director Mumbai: April 25, 2012

CEO / CFO CERTIFICATION

As required by sub clause V of Clause 49 of the Listing Agreement with the Stock Exchanges, we have certified to the Board that for the Financial Year ended March 31, 2012, the Company has complied with the requirements of the said sub-clause. For Raymond Limited For Raymond Limited Gautam Hari Singhania H. Sunder Chairman and Managing Director Whole-time Director & Chief Financial Officer Mumbai: April 25, 2012

To the Members of Raymond Limited We have examined the compliance of conditions of Corporate Governance by Raymond Limited, for the year ended 31st March 2012, as stipulated in Clause 49 of the Listing Agreements of the said Company with stock exchanges in India. The compliance of conditions of Corporate Governance is the responsibility of the Company’s management. Our examination was carried out in accordance with the Guidance Note on Certification of Corporate Governance (as stipulated in Clause 49 of the Listing Agreement), issued by the Institute of Chartered Accountants of India and was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreements. We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For Dalal & Shah Firm Registration Number: 102021W Chartered Accountants S. Venkatesh Partner Mumbai, April 25, 2012 Membership Number: F-037942

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AUDITORS’ REPORT TO THE MEMBERS OF RAYMOND LIMITED

1. We have audited the attached Balance Sheet of Raymond Limited (the “Company”) as at 31st March, 2012, and the Statement of Profit and Loss and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These financial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004 (together the “Order”), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of ‘The Companies Act, 1956’ of India (the ‘Act’) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that: (a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

(c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account; (d) In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act; (e) On the basis of written representations received from the directors, as on 31st March, 2012 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act; (f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and give a true and fair view in conformity with the accounting principles generally accepted in India: (i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2012;

(ii) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and (iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

For Dalal & Shah

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ANNEXURE TO AUDITORS’ REPORT

Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Raymond Limited on the financial statements for the year ended 31st March, 2012 1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets. (b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies between the book records and the physical inventory have been noticed. (c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year. 2. (a) The inventory (excluding stocks with third parties) has been physically verified by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. In our opinion, the frequency of verification is reasonable. (b) In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material. 3. The Company has not granted/taken any loans, secured or unsecured, to / from companies, firms or other parties covered in the register maintained under Section 301 of the Act. The other clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f) and (iii)(g) of the Order, are not applicable in the case of the Company for the current year, since in our opinion there is no matter which arises to be reported in the Order. 4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system. 5. (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that section. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees Five Lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. 6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under. 7. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. 8. We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub- section (1) of Section 209 of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. 9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues, including Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and other material statutory dues, as applicable, with the appropriate authorities. (b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of Sales-tax and Excise duty as at 31st March, 2012 which have not been deposited on account of a dispute, are as follows: Name of the Statute Nature of dues Amount Period to which Forum where the (Rs. in lacs) the amount relates dispute is pending Central Sales Tax Act and Central Sales Tax 6.30 1999-2000 Supreme Court Local Sales Tax and Local Sales Tax 11.94 1995-96 & 1996-07 High Court (including Value Added 18.76 1999-2000 Central Excise and Service Tax Appellate Tribunal 158.10 1986-87, 1989-90, Departmental 1994-95 to 1999-2000, Authorities 1995-96, 1996-97, 1998-2000, 2004-05, 2007-09. Central Excise Act Excise Duty 431.02 2004-05 High Court 874.32 1991 to 2000,Central Excise and 2001 to 2005,Service Tax Appellate 2007 to 2009 Tribunal 7.18 1994-1999 Departmental Authorities According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Income-tax, Wealth-tax, Service-Tax and Customs Duty which have not been deposited on account of any dispute.

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10. The Company has no accumulated losses as at 31st March, 2012. The Company has not incurred cash losses in the financial year ended on that date, however, it had incurred cash losses in the immediately preceding financial year. 11. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date. 12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. 13. The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company. 14. In our opinion, the Company has maintained proper records of transactions and contracts relating to dealing or trading in shares, securities, debentures and other investments during the year and timely entries have been made therein. Further, such securities have been held by the Company in its own name. 15. In our opinion, and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks or financial institutions during the year are not prejudicial to the interest of the Company. 16. In our opinion, and according to the information and explanations given to us, the term loans have been applied, on an overall basis, for the purposes for which they were obtained. 17. On the basis of an overall examination of the balance sheet of the Company, in our opinion, and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment. 18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Act during the year. 19. The Company has not issued any debentures during the year; and does not have any debentures outstanding as at the year end. 20. The Company has not raised any money by public issues during the year. 21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of any such case by the Management. For Dalal & Shah Firm Registration Number: 102021W Chartered Accountants S Venkatesh Partner Mumbai Membership Number: F-037942 25th April, 2012

Add: Balance at the beginning of the year 1428.28 2656.16 Cash and Cash Equivalents at the close of the year (Refer Note 16) 1192.08 1428.28 As per our Report of even date For DALAL & SHAH H. SUNDER GAUTAM HARI SINGHANIA Firm Registration Number 102021W Whole-time Director Chairman and Managing Director Chartered Accountants

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each Shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding. Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company: Name of the Shareholder As at 31st March, 2012 As at 31st March, 2011 No. of Shares held % of Holding No. of Shares held % of Holding J.K. Investors (Bombay) Limited 16332986 26.61 16332986 26.61 HDFC Trustee Company Limited 5484697 8.94 4822013 7.86 Life Insurance Corporation of India 4629162 7.54 6011587 9.79 (Rs. in lacs) As at As at 31st March, 2012 31st March, 2011

* Received for the Company’s investment in its manufacturing facility at Gauribidnur (Karnataka) # Dividend proposed to be distributed to equity shareholders is Rs.2.50 (Previous year Re.1.00) per equity share

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(Rs. in lacs) As at As at 31st March, 2012 31st March, 2011 Note 3 - Long Term Borrowings Secured Term loans From banks 44350.38 46381.61 From a bank 5000.00 10000.00 (Partly Secured, Refer ‘xi’ below) 49350.38 56381.61 Unsecured (a) Term loan From banks 25000.00 30000.00 (b) Foreign currency Loans from banks - 2784.60 25000.00 32784.60 Total 74350.38 89166.21 Nature of Security and terms of repayment for Long Term secured borrowings: Nature of Security Terms of Repayment i. Term loan amounting to Rs. Nil (March 31, 2011: Rs. 1560 Repayable in 28 quarterly installments commencing from lacs) is secured by Exclusive and specific charge on the October, 2006. Last installment due in January, 2013. Rate of assets acquired under the loan for plant at Thane, Jalgaon & interest 11.25% p.a. as at year end. (Previous year 8.00% p.a.)* Chhindwara. ii. Term loan amounting to Rs. 2566.05 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from October, Rs. 2793.55 lacs) is secured by a first charge on the entire 2009. Last instalment due in July, 2017. Rate of interest 12.50% immovable assets at Gauribidnur Plant and exclusive first p.a. as at year end. (Previous year 10.75% p.a).* charge on the entire movable assets located at Gauribidnur Plant. iii. Term loan amounting to Rs.13950 lacs (March 31, 2011 : Repayable in 32 quarterly installments starting from September, Rs.14550 lacs) is secured by pari passu charge on the entire 2011. Last installment due in June, 2019. Rate of interest 12.50% immovable assets at Vapi Plant and exclusive first charge p.a. as at year end. (Previous year 10.75% p.a.)* on the entire movable assets acquired out of the loans from this bank located at Vapi Plant.

iv. Term loan amounting to Rs. 2795.21 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from June, 2011. Rs. 2935.21 lacs) is secured by a first and exclusive charge Last installment due in March, 2019. Rate of interest 12.50% p.a. on movable assets acquired out of the loan. as at year end. (Previous year 11.00% p.a.)*

v. Term loan amounting to Rs.7832 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from September, Rs.8212 lacs) is secured by pari passu charge on the entire 2011. Last installment due in June, 2019. Rate of interest 13.00% immovable assets at Vapi Plant and exclusive first charge p.a. as at year end. (Previous year 11.25%p.a.)* on the entire movable assets acquired out of the loans located at the Vapi Plant. vi. Term loan amounting to Rs. 731.97 lacs (March 31, 2011: Repayable in 14 half yearly installments starting from October, Rs 1219.94 lacs) is secured by specific and exclusive charge 2007. Last installment due in April, 2014. Rate of interest 8.31% on all assets acquired under the loan at Thane, Jalgaon p.a. as at year end.(Previous Year- 8.31% p.a.)* and Chhindwara Plants. vii. Term loan amounting to Rs.6772.53 lacs (March 31, 2011: Repayable in 32 equal quarterly installments commencing from Rs.8672.53 lacs) is secured by pari passu charge on the June, 2009. Last installment due in December, 2016. Rate of immovable assets at Vapi Plant and exclusive charge on interest 9.50% p.a. as at year end.(Previous Year- 9.50% p.a.)* movable assets acquired under the loan at Vapi Plant. viii. Term loan amounting to Rs.1268.75 lacs (March 31, 2011: Repayable in 16 equal half yearly installments starting from Rs. 2206.25 lacs) is secured by exclusive charge on the October, 2007. Last installment due in April, 2014. Rate of interest specific assets and pari passu charge over the immovable 11.50% p.a. as at year end. (Previous year of 9.50% p.a.)* assets at Vapi Plant. ix. Term loan amounting to Rs.2062.50 lacs (March 31, 2011: Repayable in 16 equal half yearly installments starting from Rs. 2578.13 lacs) is secured by exclusive charge on the August, 2009. Last installment due in February, 2017. Rate of specific assets and pari passu charge over the immovable interest 11.50% p.a. as at year end. (Previous year 9.50% p.a.)* assets at Vapi Plant. x. Term loan from bank amounting to Rs. 2649.02 lacs Repayable in 32 equal quarterly installments commencing June, (March 31, 2011: Rs. 1654 lacs partial disbursement) is secured 2013. Last installment due in March, 2020. Rate of interest 12.75% by first charge on movable assets including plant and p.a. as at year end. (Previous year 11.50% p.a.) machinery, furniture and fixture and other assets of Captive Power Plant at Vapi and pari passu charge on the immovable assets at Vapi Plant.

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xi. Term loan amounting to Rs. 5000 lacs (March 31, 2011: Repayable in 3 equal yearly installments starting from March, Rs.10000 lacs) is partly secured (to the extent of 15%) by first 2012. Last installment due in March, 2014. Rate of interest 12.00% charge on unencumbered plant and machinery and other p.a. as at year end. (Previous year 12.25% p.a.) miscellaneous Fixed Assets located at various plant locations. xii. Term loan amounting to Rs. 2454.63 lacs (March 31, 2011: Repayable in 20 quarterly installments starting from December, Rs.Nil) is secured by exclusive charge on assets created out 2013. Last installment due in September, 2018. Rate of interest of Term Loan and second charge on immovable assets at 11.25% p.a. as at year end. (Previous year:Nil)* Vapi Plant. xiii. Term loan amounting to Rs.1267.72 lacs (March 31, 2011: Repayable in 20 quarterly installments starting from March, 2014 Rs.Nil) is secured by exclusive first mortage and charge on and last installment due in December, 2017. Rate of interest all the movable and immovable assets in respect of the 12.75% p.a. as at year end. (Previous year:Nil) Gauribidnur Plant.

Terms of repayment for Long Term unsecured borrowings:

Borrowings Terms of Repayment Term loans from banks Repayable in February, 2013. Rate of interest 9.00% p.a. as at Rs. Nil (Previous year Rs. 15000 lacs) year end.

Rs. 15000 lacs (Previous year Rs.15000 lacs) Repayable in November, 2013. Rate of interest 9.25% p.a. as at year end. Rs.10000 lacs (Previous year Rs. Nil) Repayable in 2 installments due in Februar y, 2015 and August,2015. Rate of interest 11.25% p.a. as at year end. Foreign Currency loan Rs.Nil (Previous year Rs. 2784.60 lacs) Repayable in five half yearly installment starting from July,2010 and last installment due in July, 2012. Rate of interest 7.74% p.a. as at year end. Installments falling due in respect of all the above Loans upto 31.03.2013 have been grouped under “Current maturities of long-term debt” (Refer Note 6) * Rate of Interest is without considering interest subsidy under TUF scheme.

(Rs. in lacs) As at As at 31st March, 2012 31st March, 2011 Note 4 - Other Long Term Liabilities (a) Present value of amounts payable, in terms of agreements with registered Workmen Union covering the workmen of the Company’s Thane Textile plant. 9628.51 9080.99 (b) Other Payables 577.83 358.43 Total 10206.34 9439.42

Aggregate of Quoted Investments 900.00 2,400.00 900.00 2,400.00

Aggregate provision for diminution in value of long term Investments 21,265.63 20,599.13

(i) The Company has an investment of Rs.1500 lacs in the shares of Everblue Apparel Limited (EBAL), a wholly owned subsidiary of the Company. Further, the Company has loans, advances and other receivables amounting to Rs.1825.86 lacs recoverable from EBAL. The net worth of EBAL has substantially eroded due to past operational losses. EBAL has entered into an arrangement with Raymond UCO Denim Private Limited (RUDPL) to manufacture Denim Jeans and other denim garments. This arrangement has improved the performance of EBAL and EBAL has been making profits for last five years. Under the circumstances, no provision is considered necessary by the management at present, for any diminution in the value of investments and also in respect of losses that may arise in respect of loans to and other receivables from EBAL.

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(ii) The Company has an aggregate exposure of Rs. 6094.14 lacs in Raymond Woollen Outerwear Limited (RWOL), a subsidiary of the Company. The net worth of RWOL has substantially eroded due to operational losses. The Board of Directors, after review, has approved subject to approval of shareholders and other statutory approval, a proposal to demerge the Jalgaon unit of RWOL into the Company with appointed date of 1st April, 2012. Under the circumstances, the Company has, at the close of the year, assessed the carrying value of its exposure and based on such assessment, made a provision of Rs.670 lacs during the year (total accumulated provision of Rs.2166.50 lacs) for permanent diminution in the value of its exposure in RWOL. Considering the present financial position of RWOL, the Board has further agreed to waive the interest due on loans amounting to Rs. 165.37 lacs. (iii) The Company has an aggregate exposure, net of provision Rs.11,141.65 lacs (gross Rs.33432.75 lacs less provision of Rs. 22291.10 lacs) in Raymond UCO Denim Private Limited (RUDPL) a joint venture company. The Company has, at the close of the year, reassessed the carrying value of the exposures. Based on the valuation by an expert, no further provision is considered necessary at present. Considering the present financial position of RUDPL, the Company has agreed to waive the interest due on loans and debentures for the year, amounting to Rs. 570.04 lacs (aggregate waiver of interest till 31st March, 2012 Rs.2069.37 lacs). The Company has, along with its JV partner, pledged entire shareholding in RUDPL as security for a loan taken by a subsidiary of RUDPL to fund the employee separation costs. For basis of valuation refer ‘ V ‘ in Annexure I. (Rs. in lacs) As at As at As at 31st March, 2012 31st March, 2011 31st March, 2010 Note 10 - Deferred tax assets (net) Deferred Tax Liability on account of : Depreciation 9195.24 9388.38 9936.85 Deferred Tax Asset on account of : (i) VRS Payments 3319.64 4533.27 816.50 (ii) Compensation payable to employees 3131.42 2946.78 - (iii) Other Employee benefits 834.10 686.56 1258.02 (iv) Taxes, Duties, Cess, etc. 332.62 197.99 208.12 (v) Provision for doubtful debts, etc. 84.06 84.07 90.73 (vi) Provision for diminution in value of Investments 0.96 0.96 0.98 (vii) Unabsorbed Depreciation 2209.88 3722.02 5457.47 9912.68 12171.65 7831.82 Deferred Tax - (Liability)/Assets- Net 717.44 2783.27 (2105.03)

For Mode of valuation, refer Annexure I

Note 15 - Trade Receivables

Trade receivables outstanding for a period exceeding six months from the date they are due for payment Secured, considered good 119.73 110.90 Unsecured, considered good 1423.06 1531.83 Unsecured, considered doubtful 418.63 433.35 Less: Provision for doubtful debts (418.63) (433.35) 1542.79 1642.73 Trade receivables outstanding for a period less than six months from the date they are due for payment Secured, considered good 3636.86 3117.93 Unsecured, considered good 34059.85 27285.19 37696.71 30403.12 Total 39239.50 32045.85

32 Remittance in Foreign Currency on account of dividends:

(a) Year to which the dividend relates 2010-11 2009-10 (b) Number of non-resident shareholders to whom remittances were made 47 Nil (c) Number of shares on which remittances were made 43730 Nil (d) Amount remitted (Rs. in lacs) 0.43 Nil 33 A. Trade Payables includes (i) Rs. Nil (Previous Year Rs. Nil) due to micro and small enterprises registered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) Rs. 21917.65 lacs (Previous Year Rs. 19754.84 lacs) due to other parties. B. No interest is paid / payable during the year to any enterprise registered under the MSME. C. The above information has been determined to the extent such parties could be identified on the basis of the information available with the Company regarding the status of suppliers under the MSME. 34 Disclosure in respect of derivative instruments : (a) Derivative instruments outstanding : Millions Forward Option Swap (i) Against Imports USD/INR 11.60 (10.40) USD/INR 1.00 - AUD/USD 6.65 (5.97) AUD/USD 3.40 (5.00) AUD/INR - (1.00)

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36 Lease: As at 31.03.2012 As at 31.03.2011 (Rs. In lacs) (Rs. in lacs) (a) Premises taken on operating lease: The total future minimum lease rentals payable at the Balance Sheet date is as under: For a period not later than one year 3711.50 3556.16 For a period later than one year and not later than five years 8313.80 9617.54 For a period later than five years 377.53 758.46 (b) Vehicles taken on operating lease: The total future minimum lease rentals payable at the Balance Sheet date is as under: For a period not later than one year 88.74 89.00 For a period later than one year and not later than five years 86.49 171.18 For a period later than five years - - Total operating lease expenses debited to Profit and Loss Account is Rs.4814.80 lacs (Previous year 4624.06 lacs) (c) Premises given on operating lease: (i) Buildings: Gross carrying amount 244.74 244.74 Depreciation for the year 8.21 8.27 Accumulated Depreciation 70.49 62.28 The value of portions of premises given on operating lease is not disclosed above since identification of value relatable to the portion is not possible. (ii) The total future minimum lease rentals receivable at the Balance Sheet date is as under: For a period not later than one year 169.64 151.54 For a period later than one year and not later than five years 218.16 375.15 For a period later than five years - - 37 Disclosures pursuant to Accounting Standard-15 “Employee Benefits” a. The Company has recognised Rs. 1616.76 Lacs (Previous Year Rs. 2185.79 Lacs) in the Statement of Profit and Loss for the year ended 31st March, 2012 under Defined Contribution Plans (Rs. in lacs) 31st March, 2012 31st March, 2011 Gratuity Pension Gratuity Pension b. Details of Defined Benefit Plan 1 Components of Employer Expense (a) Current Service Cost 318.16 3.78 258.34 28.29 (b) Interest Cost 368.16 10.78 476.85 62.78 (c) Expected Return on Plan Assets (318.07) - (438.91) - (d) Actuarial (Gain)/Loss (25.82) (9.46) 176.74 (698.10) (e) Past Service Cost - 971.04 - (f) Total expense/(gain) recognised in the Profit and Loss Account 342.43 5.10 1444.06 (607.03) 2 Net Asset/(Liability) recognised in Balance Sheet (a) Present Value of Obligation as at the close of the year 4767.47 95.86 4191.20 136.60 (b) Fair Value of Plan Assets as at the close of the year 4767.47 N.A. 4191.20 N.A. (c) Asset/(Liability) recognised in the Balance Sheet - (95.86) - (136.60) 3 Change in Defined Benefit Obligation (DBO) during the year ended (a) Present Value of Obligation as at the beginning of the year 4191.20 136.60 5284.15 830.62 (b) Current Service Cost 318.16 3.78 258.34 28.29 (c) Interest Cost 368.16 10.78 476.85 62.78 (d) Actuarial (Gain)/Loss 11.68 (9.46) 151.52 (698.10) (e) Past Service Cost - - 971.04 - (f) Benefits Paid (121.73) (45.84) (2950.70) (86.99) (g) Present Value of Obligation as at the close of the year 4767.47 95.86 4191.20 136.60 4 Changes in the Fair Value of Plan Assets (a) Present Value of Plan Assets as at the beginning of the year 4191.20 5284.15 (b) Expected Return on Plan Assets 318.07 438.91 (c) Actuarial Gain/(Loss) 37.50 (25.22) (d) Actual Company Contribution 342.43 N.A. 1,444.06 N.A. (e) Benefits Paid (121.73) (2950.70) (f) Fair Value of Plan Assets as at the close of the year 4767.47 4191.20 5 Expected Employer’s Contribution for next year 300.00 21.67 300.00 22.56

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(Rs.In lacs) As at As at 31st March, 2012 31st March, 2011 42 Contingent liabilities and commitments (to the extent not provided for) (i) Contingent Liabilities (a) Claims against the Company not acknowledged as debts in respect of past disputed liabilities of the Cement and Steel Divisions divested during the year 2000-2001, Carded Woollen business divested during the year 2005-06, Denim Division divested during the year 2006-07 (interest thereon not ascertainable at present). Sales Tax 98.54 98.54 Royalty 2201.94 2201.94 Other Matters 152.09 152.09 2452.57 2452.57 (b) Claims against the Company not acknowledged as debts in respect of other divisions. - Sales Tax 148.42 416.64 - Compensation for Premises 1301.41 1611.50 - Stamp Duty 174.16 174.16 - Water Charges 63.40 82.25 - Other Matters 51.91 132.30 1739.30 2416.85 (c) Bills Discounted with the Company’s bankers 3329.61 718.75 (d) On account of corporate guarantee to the bankers/vendors on behalf of subsidiaries for facilities availed by them (amount outstanding at close of the year) 4559.50 6421.93 (e) Disputed demands in respect of Income-tax, etc. (Interest thereon not ascertainable at present) 1836.54 2189.28 (f) Bonds/Undertakings given by the Company under concessional duty/exemption scheme to Government authorities (Net of obligations fulfilled) 5502.72 9456.50 (g) Disputed liability towards Excise duty on Post Removal of Goods from place of manufacture - 2118.90 (h) Disputed Excise Duty Liability in respect of other matters (includes Rs. Nil, Previous Year Rs. 645.10 lacs, on account of denial of excise exemption benefit) 1568.77 1537.84 (i) Liability on account of jute packaging obligation upto 30th June, 1997, Amount not Amount not in respect of the Company’s erstwhile Cement Division, under the Jute determinable determinable Packaging Materials (Compulsory use in Packing Commodities) Act, 1987. (j) Company’s liabilities/ obligations pertaining to the period upto the date of Amount not Amount not transfer of the Company’s erstwhile Steel, Cement, Carded Woollen Division determinable determinable and Denim Division in respect of which the Company has given undertakings to the acquirers Future cash flows in respect of (a), (b), (e), (g) to (j) above are determinable only on receipt of judgements/decisions pending with various forums/authorities (ii) Commitments Estimated amount of contracts remaining to be executed on capital account and not provided for 4562.87 5787.61 43 The financial statements for the year ended 31st March, 2011 had been prepared as per the then applicable, pre- revised Schedule VI to the Companies Act,1956. Consequent to the notification under the Companies Act,1956, the financial statements for the year ended 31st March, 2012 are prepared under revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year’s classification. 44 Significant accounting policies and practices adopted by the Company are disclosed in the statement annexed to these financial statements as Annexure I. As per our Report of even date For DALAL & SHAH H. SUNDER GAUTAM HARI SINGHANIA Firm Registration Number 102021W Whole-time Director Chairman and Managing Director Chartered Accountants S. Venkatesh THOMAS FERNANDES Partner Director-Secretarial & Membership No. F-037942 Company Secretary Mumbai, 25th April, 2012 Mumbai, 25th April, 2012

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ANNEXURE I STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (annexed to and forming part of the financial statements for the year ended 31st March, 2012) These financial statements have been prepared on an accrual basis and under historical cost convention and in compliance, in all material aspects, with the applicable accounting principles in India, the applicable accounting standards notified under Section 211 (3C) and the other relevant provisions of the Companies Act, 1956. All the assets and liabilities have been classified as current or non current as per the Company’s normal operating cycle and other criteria set out in Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle to be less than 12 months. I. RECOGNITION OF INCOME AND EXPENDITURE : (i) Revenues/Incomes and Costs/Expenditure are generally accounted on accrual, as they are earned or incurred. (ii) Sale of Goods is recognised on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods. II. USE OF ESTIMATES : The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known/materialised. III. FIXED ASSETS : Fixed Assets (other than livestock) are stated at cost, less accumulated depreciation (other than ‘Freehold Land’ where no depreciation is charged). Cost comprises the purchase price, including duties and other non-refundable taxes or levies any directly attributable cost of bringing the asset to its working condition and indirect costs specifically attributable to construction of a project or to the acquisition of a fixed asset. Livestock are stated at Book Value. Assets retired from active use are carried at lower of book value and estimated net realisable value. IV. METHOD OF DEPRECIATION AND AMORTISATION : (i) Depreciation on Factory Buildings, Plant and Machinery, Electrical Installations and Equipment (other than Aircraft which depreciated on the basis of balance of useful life) is provided on the Straight Line Method (S.L.M.) by writing off 95% of the cost of the assets over the ‘Specified Period’ of the assets in accordance with the provisions of Section 205 (2)(b) of the Companies Act, 1956. (ii) Depreciation on other Fixed Assets (other than ‘Land’ and ‘Livestock’ where no depreciation is provided), is provided on the “Written Down Value Method” (W.D.V.) at the rates specified in Schedule XIV to the Companies Act, 1956 from time to time. (iii) Depreciation on all assets referred to in (i) above, acquired upto 31st March, 1987, is provided at the rates of depreciation prevalent at the time of acquisition of the assets, in pursuance of Circular No. 1 of 1986, (1.1/86-CL-V) dated 21st May, 1986, issued by the Company Law Board. (iv) Depreciation on additions to Fixed Assets after 1st April, 1987 is provided at the relevant rates of depreciation in respect of S.L.M. and W.D.V., as specified in Schedule XIV to the Companies Act, 1956 from time to time. (v) Depreciation on additions to assets or on sale/discardment of assets, is calculated pro rata from the month of such addition or upto the month of such sale/discardment, as the case may be; (vi) Cost of Technical Know-how capitalised is amortised over a period of six years thereof. (vii) Cost of Software capitalised is amortised over a period of three years. (viii) Cost of Leasehold Land is amortised over the period of lease. V. INVESTMENTS : Investments are classified into Current and Long-term Investments. Current Investments are stated at lower of cost and fair value. Long-term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of Long-term Investments. However, fixed income long term securities are stated at cost, less amortisation of premium/ discount and provision for diminution to recognise a decline, other than temporary. VI. VALUATION OF INVENTORIES : Inventories of Raw Materials, Work-in-Progress, Stores and Spares, Finished Goods and Stock-in-trade are stated ‘at cost or net realisable value, whichever is lower’. Goods-in-Transit are stated ‘at cost’. Cost comprise all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. The excise duty in respect of closing inventory of finished goods is included as part of finished goods. Cost formulae used are ‘First-in-First-out’, ‘Weighted Average cost’ or ‘Specific identification’, as applicable. Due allowance is estimated and made for defective and obsolete items, wherever necessary, based on the past experience of the Company. VII. FOREIGN CURRENCY TRANSLATIONS : (i) All transactions in foreign currency, are recorded at the rates of exchange prevailing on the dates when the relevant transactions take place. (ii) Monetary items in the form of Loans, Current Assets and Current Liabilities in foreign currency, outstanding at the close of the year, are converted in Indian Currency at the appropriate rates of exchange prevailing on the date of the Balance Sheet. Resultant gain or loss is accounted during the year. (iii) In respect of Forward Exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Further, the exchange differences arising on such contracts are recognised as income or expense along with the exchange differences on the underlying assets/liabilities. Further, in case of other contracts with committed exchange rates, the

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underlying is accounted at the rate so committed. Profit or loss on cancellations/renewals of forward contracts is recognised during the year. In case of options contract, the losses are accounted on mark to market basis. (iv) All other incomes or expenditure in foreign currency, are recorded at the rates of exchange prevailing on the dates when the relevant transactions take place. (v) Transactions covered by cross currency swap contracts to be settled on future dates are recognised at the rates of exchange of the underlying foreign currency prevailing on the date of the Balance Sheet. Effects arising out of swap contracts are accounted/adjusted on the date of settlement. (vi) Accounting of foreign branch: (a) Current assets and liabilities are converted at the appropriate rates of exchange prevailing on the date of the Balance Sheet. (b) Fixed Assets are converted at the exchange rates prevailing on the date of the transaction. (c) Revenue items, except depreciation, are converted at monthly average rates of exchange. (d) Depreciation has been translated at the exchange rates used for the conversion of respective fixed assets. VIII. RESEARCH AND DEVELOPMENT : Revenue expenditure, including overheads on Research and Development, is charged out as an expense through the natural heads of account in the year in which incurred. Expenditure which results in the creation of capital assets is taken as Fixed Assets and depreciation is provided on such assets as are depreciable. IX. EMPLOYEE BENEFITS Defined Contribution Plans such as Provident Fund etc., are charged to the Profit and Loss Account as incurred. Defined Benefit Plans - The present value of the obligation under such plan, is determined based on an actuarial valuation using the Projected Unit Credit Method. Actuarial gains and losses arising on such valuation are recognised immediately in the Profit and Loss Account. In case of funded defined benefit plans, the fair value of the plan assets is reduced from the gross obligation under the defined benefit plans, to recognise the obligation on net basis. Further for certain employees, the monthly contribution for Provident Fund is made to a Trust administered by the Company. The interest payable by the Trust is notified by the Government. The Company has an obligation to make good the shortfall, if any. Other Long term Employee Benefits are recognised in the same manner as Defined Benefit Plans. Termination benefits are recognised as and when incurred. However, the termination benefits which fall due more than twelve months after the Balance Sheet date are discounted using the yield on Government Bonds. X. PROJECT DEVELOPMENT EXPENSES PENDING ADJUSTMENT : Expenditure incurred during developmental and preliminary stages of the Company’s new projects, are carried forward. However, if any project is abandoned, the expenditure relevant to such project is written off through the natural heads of expenses in the year in which it is so abandoned. XI. BORROWING COSTS : Interest and other borrowing costs attributable to qualifying assets are capitalised. Other interest and borrowing costs are charged to revenue. XII. GOVERNMENT GRANTS: Grants received against specific fixed assets are adjusted to the cost of the assets and those in the nature of promoter’s contribution are credited to Capital Reserve. Revenue Grants are recognised in the Profit and Loss Account in accordance with the related scheme and in the period in which these are accrued. XIII. PROVISIONS, CONTINGENT LIABILITIES AND CONTIGENT ASSETS A provision is recognised when there is a present obligation as a result of a past event, that probably requires an outflow of resources and a reliable estimate can be made to settle the amount of obligation. Provision is not discounted to its present value and is determined based on the last estimate required to settle the obligation at the year end. These are reviewed at each year end and adjusted to reflect the best current estimate. Contingent liabilities are not recognised but disclosed in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statements. XIV. APPLICATION OF SECURITIES PREMIUM ACCOUNT : Share and Debenture Issue expenses and Premium payable on redemption of Debentures, are charged, first against available balance in Securities Premium Account. XV. TAXATION : Income-tax expense comprises current tax and deferred tax charge or credit. Provision for current tax is made on the basis of the assessable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation. Minimum Alternative Tax credit is recognised as an asset only when and to the extant there is convincing evidence that the company will pay normal tax during the specified period. XVI. IMPAIRMENT OF ASSETS: The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An asset is impaired when the carrying amount of the asset exceeds the recoverable amount. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. An impairment loss recognised in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount.

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AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS OF RAYMOND LIMITED

The Board of Directors of Raymond Limited 1. We have audited the attached consolidated balance sheet of Raymond Limited (the “Company”) and its subsidiaries, its jointly controlled entities and associate companies; hereinafter referred to as the “Group” (refer Note 1 to the attached consolidated financial statements) as at 31st March 2012, the related consolidated Statement of Profit and Loss and the consolidated Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. We did not audit the financial statements of (i) Five Subsidiaries, a jointly controlled entity, and a subsidiary and a jointly controlled entity of a jointly controlled entity included in the consolidated financial statements, which constitute total assets of Rs. 42,315 lacs and net assets of Rs. 23,604 lacs as at 31st March 2012, total revenue of Rs. 50,501 lacs, net profit of Rs. 2,111 lacs and net cash flows amounting to Rs. 261 lacs for the year then ended; and (ii) Two associate companies which constitute net profit of Rs. 1,227 lacs for the year then ended. These financial statements and other financial information have been audited by other auditors whose reports have been furnished to us, and our opinion on the consolidated financial statements to the extent they have been derived from such financial statements is based solely on the report of such other auditors. 4. We report that the consolidated financial statements have been prepared by the Company’s Management in accordance with the requirements of Accounting Standard (AS) 21 - Consolidated Financial Statements, Accounting Standard (AS) 23 - Accounting for Investments in Associates in Consolidated Financial Statements, and Accounting Standard (AS) 27 - Financial Reporting of Interests in Joint Ventures notified under sub-section 3C of Section 211 of the Companies Act, 1956. 5. Based on our audit and on consideration of reports of other auditor(s) on separate financial statements and on the other financial information of the component(s) of the Group as referred to above, and to the best of our information and according to the explanations given to us, in our opinion, the attached consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the consolidated Balance Sheet, of the state of affairs of the Group as at 31st March 2012; (b) in the case of the consolidated Statement of Profit and Loss, of the profit of the Group for the year ended on that date: and (c) in the case of the consolidated Cash Flow Statement, of the cash flows of the Group for the year ended on that date. For Dalal & Shah Firm Registration Number: 102021w Chartered Accountants S Venkatesh Partner Place:- Mumbai Membership Number:- F-037942 Date:- 25th April, 2012

The Company has only one class of equity share having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders except in case of interim dividend. In the Event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding. Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company: Name of the Shareholder As at 31st March, 2012 As at 31st March, 2011 No. of Shares held % of holding No. of Shares held % of holding J.K. Investors (Bombay ) Limited 16332986 26.61 16332986 26.61 Life Insurance Corporation of India 4629162 7.54 6011587 9.79 HDFC Trustee Company Limited 5484697 8.94 4822013 7.86 Note 3 - Reserves and Surplus a. Capital Reserves Balance as per last account 2204.29 2611.95 Add : Capital Subsidy* 20.00 — Add/(Less) - Arising from new subsidiary (Trinity India Limited)/Conversion of joint venture to subsidiary (Solitaire Fashions Limited) 261.20 (500.00) Add: Arising from the amalgamation — 92.34 Closing Balance 2485.49 2204.29 b. Capital Redemption Reserve Balance as per last account 1919.51 1521.51 (+) Current Year Transfer — 398.00 Closing Balance 1919.51 1919.51 c. Securities Premium Account 14778.55 14778.55 d. Currency Fluctuation Reserve Balance as per last account 1137.97 802.46 (+) During the year 471.50 335.51 Closing Balance 1609.47 1137.97 e. Legal Reserve 7.22 7.22 f. General Reserves Balance as per last account 85703.26 89518.50 Less:Transferred (to)/from 563.50 (3815.24) Closing Balance 86266.76 85703.26 g. Retained Earning in Associates (Refer note 39) 6404.28 5007.37 h. Surplus Opening balance 33217.62 30194.75 (+) Net Profit For the current year 15893.67 841.16 (+) Net Profit/(Net Loss) For the current year (Share in Joint Venture) (315.71) 4527.58 (-) Proposed Dividend# 1,534.52 613.81 (-) Tax on proposed Dividend 248.94 99.59 (-) Transfer to (Capital Redemption Reserve) — 398.00 (-) Transfer to General Reserve 563.50 — (-) Transfer to Share of Retained Earning in Associates 1396.91 1234.47 Closing Balance 45051.71 33217.62 Total 158522.99 143975.79 Share in Joint Ventures (28426.72) (28096.61) Total 130096.27 115879.18 * Received for the Company’s investment in its manufacturing facility at Gauribidnur (Karnataka) # Dividend proposed to be distributed to equity shareholders is Rs.2.50 (Previous year Re.1) per equity share

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Note 4 - Long Term Borrowings

As at As at 31st March, 2012 31st March, 2011 (Rs. In lacs) (Rs. In lacs)

Secured (a) Term loans from banks 48989.22 50297.48 from banks (Partly Secured) 5000.00 10000.00 from other parties 378.12 — 54367.34 60297.48 Unsecured (a) Term loans from banks 25000.00 30000.00 (b) Deferred payment liabilities 559.83 560.85 (c) Foreign currency Loans from banks — 2784.60 25559.83 33345.45 Total 79927.17 93642.93 Share in Joint Ventures 8506.46 9843.17 Total 88433.63 103486.10 Nature of Security and terms of repayment for Long Term secured borrowings: Nature of Security Terms of Repayment i. Term loan amounting to Rs. Nil (March 31, 2011: Rs. 1560 lacs) is Repayable in 28 quarterly installments commencing from secured by Exclusive and specific charge on the assets October, 2006. Last installment due in January, 2013. Rate of acquired under the loan for plant at Thane, Jalgaon & interest 11.25% p.a. as at year end. (Previous year 8.00% p.a.)* Chhindwara. ii. Term loan amounting to Rs. 2566.05 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from October,2009. Rs. 2793.55 lacs) is secured by a first charge on the entire Last installment due in July, 2017. Rate of interest 12.50% p.a. as immovable assets at Gauribidnur Plant and exclusive first charge at year end. (Previous year 10.75% p.a).* on the entire movable assets located at Gauribidnur Plant. iii. Term loan amounting to Rs.13950 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from Rs.14550 lacs) is secured by pari passu charge on the entire September,2011. Last installment due in June, 2019. Rate of immovable assets at Vapi Plant and exclusive first charge interest 12.50% p.a. as at year end. (Previous year 10.75% p.a.)* on the entire movable assets acquired out of the loans from this bank located at Vapi Plant. iv. Term loan amounting to Rs. 2795.21 lacs (March 31, 2011: Repayable in 32 quarterly installments starting from June, 2011. Rs. 2935.21 lacs) is secured by a first and exclusive charge Last installment due in March, 2019. Rate of interest 12.50% p.a. on movable assets acquired out of the loan. as at year end. (Previous year 11.00% p.a.)* v. Term loan amounting to Rs.7832 lacs (March 31, 2011: Rs. 8212 Repayable in 32 quarterly installments starting from lacs) is secured by pari passu Charge on the entire September, 2011. Last installment due in June, 2019. Rate of immovable assets at Vapi Plant and exclusive first charge interest 13.00% p.a. as at year end. (Previous year 11.25%p.a.)* on the entire movable assets acquired out of the loans located at the Vapi Plant. vi. Term loan amounting to Rs. 731.97 lacs (March 31, 2011: Repayable in 14 half yearly installments starting from October, 2007. Rs. 1219.94 lacs) is secured by Specific and exclusive charge Last installment due in April, 2014. Rate of interest 8.31% p.a. as on all assets acquired under the loan at Thane, Jalgaon at year end.(Previous Year 8.31% p.a.)* and Chhindwara Plants. vii. Term loan amounting to Rs.6772.53 lacs (March 31, 2011: Repayable in 32 equal quarterly installments commencing from Rs.8672.53 lacs) is secured by pari passu charge on the June, 2009. Last installment due in December, 2016. Rate of immovable assets at Vapi Plant and exclusive charge on interest 9.50% p.a. as at year end.(Previous Year 9.50% p.a.)* movable assets acquired under the loan at Vapi Plant. viii. Term loan amounting to Rs.1268.75 lacs (March 31, 2011: Repayable in 16 equal half yearly installments starting from Rs. 2206.25 lacs) is secured by exclusive charge on the October, 2007. Last installment due in April, 2014. Rate of interest specific assets and pari passu charge over the immovable 11.50% p.a. as at year end. (Previous year 9.50% p.a.)* assets of the company at Vapi Plant. ix. Term loan amounting to Rs. 2062.50 lacs (March 31, 2011: Repayable in 16 equal half yearly installments starting from Rs. 2578.13 lacs) is secured by exclusive charge on the August, 2009. Last installment due in February, 2017. Rate of specific assets and pari passu charge over the immovable interest 11.50% p.a. as at year end. (Previous year 9.50% p.a.)* assets of the company at Vapi Plant.

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x. Term loan from bank amounting to Rs. 2649.02 Lacs Repayable in 32 equal quarterly installments commencing (March 31, 2011: Rs. 1654 Lacs partial disbursement) is June, 2013. Last installment due in March, 2020. Rate of interest secured by first charge on movable assets including plant 12.75% p.a. as at year end. (Previous year 11.50% p.a.) and machinery, furniture and fixture and other assets of Captive Power Plant at Vapi and pari passu charge on the immovable assets at Vapi Plant. xi. Term loan amounting to Rs. 5000 Lacs (March 31, 2011: Repayable in 3 equal yearly installments starting from Rs.10000 Lacs) is Partly secured (to the extant of 15%) by March, 2012. Last installment due in March, 2014. Rate of interest first charge on unencumbered plant and machinery and 12.00% p.a. as at year end. (Previous year 12.25% p.a.) other miscellaneous Fixed Assets located at various plant locations. xii. Term loan amounting to Rs. 2454.63 Lacs (March 31, 2011: Repayable in 20 quarterly installments starting from Rs.Nil) is secured by Exclusive charge on assets created out December, 2013. Last installment due in September, 2018. Rate of Term Loan and second charge on immovable assets at of interest 11.25% p.a. as at year end. (Previous year:Nil)* Vapi Plant. xiii. Term loans amounting to Rs.1267.72 Lacs (March 31, 2011: Repayable in 20 quarterly installments starting from March,2014 Rs.Nil) is secured by exclusive first mortage and charge on and last installment due in December, 2017. Rate of interest all the movable and immovable assets in respect of the 12.75% p.a. as at year end. (Previous year:Nil) Gauribidnur Plant. Subsidiaries Loan Amounting to Rs. 5016.96 Lacs in subsidiary secured by Repayable in specified installment (Monthly ,Quarterly and Half hypothecation charge over assets of the respective subsidiary yearly). Interest rate from 8% to 15% company Share in JV Term Loan Amounting to Rs.8506.46 Lacs share in Joint Ventures Repayable in specified installment (Quarterly, Half yearly). Interest secured by hypothecation charge over assets of the respective rate from 10% to 14% joint venture company Terms of repayment for Long Term unsecured borrowings: Borrowings Terms of Repayment Term loans from banks Rs. Nil (Previous year Rs. 15000 Lacs) Repayable in February, 2013. Rate of interest 9.00% p.a. as at year end.

Rs. 15000 Lacs (Previous year Rs.15000 Lacs) Repayable in November, 2013. Rate of interest 9.25% p.a. as at year end Rs.10000 Lacs (Previous year Rs. Nil) Repayable in 2 installments due in Februar y, 2015 and Foreign Currency loan August, 2015. Rate of interest 11.25% p.a. as at year end Rs.Nil (Previous year Rs. 2784.60 Lacs) Repayable in 5 half yearly installment starting from July, 2010 and last installment due in July, 2012. Rate of interest 7.74% p.a. as at year end. Deferred payment liabilities (Subsidiaries) Loan Amounting to Rs. 559.83 Lacs in subsidiary is sales tax Repayable in specified installment (repayable yearly). Interest deferment loan of the respective subsidiary company free

Installments falling due in respect of all the above Loans upto 31.03.2013 have been grouped under “Current maturities of long-term debt” (Refer Note 8) * Rate of Interest is without considering interest subsidy under TUF scheme.

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(Rs. In lacs) As at 31st As at 31st March, 2012 March, 2011

Note 16 - Trade Receivables

Trade receivables outstanding for a period exceeding six months from the date they are due for payment Secured, considered good 120.23 128.45 Unsecured, considered good 1513.31 1629.76 Unsecured, considered doubtful 554.86 479.28 Less: Provision for doubtful debts (554.86) (479.28) 1633.54 1758.21 Trade receivables outstanding for a period less than six months from the date they are due for payment Secured, considered good 5552.75 4181.77 Unsecured, considered good 47422.27 35384.74 Unsecured, considered doubtful 17.04 22.82 Less: Provision for doubtful debts (17.04) (22.82) 52975.02 39566.51 Total 54608.56 41324.72 Share in Joint Ventures 9046.61 7539.23 Total 63655.17 48863.95

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CMYK

28. A. Contingent Liabilities not provided for: (Rs. in lacs)

31st March, 2012 31st March, 2011 (a) Claims against the Company not acknowledged as debts in respect of past disputed liabilities of the Cement and Steel Divisions divested during the year 2000-2001, Carded Woollen business divested during the year 2005-2006 and Denim Division divested during the year 2006-07. (interest thereon not ascertainable at present). 2452.57 2452.57 (b) Claims against the Companies not acknowledged as debts (including share of Joint Ventures Rs.33.84 Lacs) 2484.28 2872.99 (c) Bills Discounted with the Company’s bankers. (including share of Joint Ventures Rs. 1336.38 Lacs; Previous Year Rs. 1777.85 Lacs) 4989.99 2496.67 (d) On account of corporate guarantee to the bankers, vendors on behalf of subsidiaries for facilities availed by them. 4559.50 6421.93 (e) Disputed demand in respect of Income-tax etc. (interest thereon not ascertainable at present.) 2162.49 3111.12 (f) Bonds/Undertakings given by the Company under concessional duty/exemption scheme to Customs authorities (including share of Joint Ventures Rs. 783.30 Lacs; Previous year Rs. 473.70 Lacs) 2526.90 1653.27 (g) Disputed liability towards Excise Duty on Post Removal of Goods from the place of manufacture. - 2118.90 (h) Disputed Excise Duty Liability in respect of other matters. 1939.62 2087.06 {(Includes Rs. 645.10 Lacs (Previous Year Rs. 645.10 Lacs) on account of denial of excise exemption benefit) (including share of joint venture Rs. 69.87 Lacs; Previous year Rs.67.25 Lacs)} (i) Liability on account of jute packaging obligation upto 30th June, 1997, in respect of the Company’s erstwhile Cement Division, under the Jute Packaging Materials (Compulsory use in packing Commodities) Act, 1987. Amount not determinable (j) Company’s liabilities/obligations pertaining to the period upto the date of transfer of the Company’s erstwhile Steel, Cement, Carded Woollen and Denim Divisions in respect of which the Company has given undertaking to the acquirers. Amount not determinable (k) Share in the Contingent Liabilities of an Associate 610.46 623.50 B. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) [including Rs. 19.81 Lacs (Previous year Rs.12.39 Lacs) being share in an Associate Company] [including share of Joint Ventures Rs. 808.89 Lacs (Previous Year Rs. 401.81 Lacs)] 6933.82 6535.39 29. Exceptional Items: (Rs. In lacs) Year ended Year ended 31st March, 2012 31st March, 2011 (a) VRS/Termination payments - (24555.16) (b) Net surplus on settlement with Bankers by RUDPL - 4474.19 (c) Net loss on diluation of 50% stake in UCO Tesatura SRL by RUDPL - (440.38) - (20521.35) 30. Deferred Tax: As at As at As at 31-3-2012 31-3-2011 31-3-2010 (a) Deferred Tax Liability on account of: Depreciation (net) 12872.88 12799.97 12620.22 12872.88 12799.97 12620.22 (b) Deferred Tax Asset on account of: (i) VRS payments 3620.66 4874.27 940.79 (ii) Employee benefits 4205.72 3757.06 1397.26 (iii) Taxes, Duties, Cess, etc. 332.62 197.99 208.12 (iv) Provision for doubtful debts, etc. 116.84 119.03 409.44 (v) Provision for diminution in value of investments 0.96 - 0.98 (vi) Unabsorbed depreciation and losses 4757.03 6550.04 7455.07 (vii) Others 40.85 275.06 89.97 13074.67 15773.45 10501.63 Deferred Tax Liability/(Asset) (Net) (201.80) (2973.48) 2118.59 31. Variation between the Accounting Policies followed by various entities within the group: Accounting for improvements to Leasehold Premises by Raymond Limited is in variation to the methods adopted by other entities in the group. The impact of the above, in the opinion of the management, would not be significant. 32. In terms of addendum to the Shareholders’ Agreement UCO NV, JV partner in Raymond UCO Denim Private Limited (RUDPL) had agreed to purchase the Plant & Machinery leased by ING Leasing to UCO Tesatura, a JV of UCO NV and RUDPL. Pending conclusion of sale deed, effect of this arrangement has been taken in books of UCO Tesatura and consequently in these Consolidated Financial Statements. 33. The details of subsidiaries in terms of General circular no. 2/2011 Dated 08th Feb 2011 issued by Government of India, Ministry of Corporate Affairs under Section 212(8) of the Companies Act, 1956, are disclosed in Annexure II to these financial statements. 34. The Income Tax Authorities carried out search and seizure operation on 3rd and 4th November 2011 on the premises of the Company and its few subsidiaries. The Company and the subsidiaries have co-operated with the authorities and provided necessary details/informations as and when asked for by the Tax Authorities. No Notices have so far been received by the Company and the subsidiaries for filing tax returns under Section 153A of the Income Tax Act, 1961.

C. OTHER DISCLOSURES 1. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS-17) taking into account the organisation structure as well as the differential risks and returns of these segments. 2. The Company has disclosed Business Segment as the primary segment. 3. Types of products and services in each business segment: Business Segment Types of Products and services a) Textiles - Fabric, rugs, blankets, shawls and furnishing fabric b) Denim - Denim fabric and cotton yarn c) Garments - Readymade garments and designerwear d) Tools and Hardware - Engineers’ files and rasps, H.S.S. twist drills and bars and rods (HRS) e) Auto Components - Starter Gear, Shaft Bearings, Sheet metal components and forged components. f) Others - Aviation, Real Estate etc. 4. Inter Segment revenues are recognised at sales price. 5. The Segment Revenues, Results, Assets and Liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

74 .... Consolidated Financial Statements

CMYK

As at As at 31st March, 31st March, 2012 2011 (Rs. in lacs) (Rs. in lacs)

Consolidated Financial Statements .... 75

CMYK

b. Details of Defined Benefit Plan

SERIAL NO PARTICULARS 31st March 2012 31st March 2011 Gratuity Pension Gratuity Pension 6 Percentage of each Category of Plan Assets to total Fair Value of Plan Assets as at 31st March, 2008 Plan Assets as at the close of the year (a) Government Securities 27.00% - 33.00% - (b) Corporate Bonds 11.00% - 15.00% - (c) Insurer Managed Funds 62.00% - 52.00% - 7 Actuarial Assumptions of Past 5 years GRATUITY AND PENSION (a) Discount Rate (per annum) 8% to 8.35% 8.35% 8% to 8.35% 8.35% (b) Expected Rate of Return on Assets (per annum) 7.5% to 8.6% N.A. 7.5% to 9.25% N.A. (c) Salary Escalation Rate* 5% to 7.5% 7.50% 5% to 7.5% 7.50% * The excess of Asset over Liability Rs. 13.10 lacs (Previous year: Rs. 9.06 lacs) has not been recognised , as they are lying in an Income Tax Approved Irrevocable Trust Fund. A. Provident Fund Liability In case of certain employees , the Provident Fund contribution is made to a trust administered by the Company. In terms of the guidance note issued by the institute of Actuaries of India, the actuary has provided a valuation of Provident Fund liability based on the assumptions listed below and determined that there is no shortfall as at 31st March, 2012. The assumptions used in determining the present value of obligation of the interest rate guarantee under deterministic approach are:- Remaining term of maturity - 7 years Expected guaranteed interest rate - 8.25 % Discount rate for the remaining term to maturity of interest portfolio - 8.60 %

CONSOLIDATED FINANCIAL STATEMENTS

ANNEXURE I STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (annexed to and forming part of the financial statement for the year ended 31st March, 2012) I. BASIS OF PREPARATION OF FINANCIAL STATEMENTS : (i) The financial statements of the subsidiaries used in the consolidation are drawn upto the same reporting date as that of the Parent Company, i.e. year ended 31st March. Certain foreign subsidiaries follow January to December as their financial year. In the case of these foreign subsidiaries the Company has redrawn their financial statements for the year ended 31st March. (ii) The financial statements have been prepared under the historical cost convention and on the accrual basis of accounting. The accounts of the Parent Company, Indian Subsidiaries and Joint Venture Companies have been prepared in accordance with the Indian Accounting Standards and those of the foreign subsidiaries have been prepared in accordance with the local laws and the applicable Accounting Standards/generally accepted accounting principles. (iii) All the assets and liabilities have been classified as current or non current as per the normal operating cycle and other criteria set out in Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalent, its operating cycle to be less than 12 months. II. PRINCIPLES OF CONSOLIDATION : (i) The financial statements of the Parent Company and its subsidiaries have been consolidated on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances, intra-group transactions and the unrealised profits. (ii) The financial statements of the Parent Company and its subsidiaries have been consolidated using uniform accounting policies excepting the revaluation of assets by companies referred above. Further, accounting for improvements to Leasehold Premises by Raymond Limited is in variation to the methods adopted by other entities in the group. (iii) The excess of the cost to the Parent Company of its investments in each of the subsidiaries over its share of equity in the respective subsidiary, on the acquisition date, is recognised in the financial statements as goodwill and amortised over a period of ten years. Fluctuation to goodwill in respect of foreign subsidiary arising subsequent to acquisition, on translation at the year end rate, is included in the currency fluctuation reserve III. RECOGNITION OF INCOME AND EXPENDITURE : (i) Revenues/Incomes and Costs/Expenditure are generally accounted on accrual, as they are earned or incurred. (ii) Sale of Goods is recognised on transfer of significant risks and rewards of ownership which is generally on the dispatch of goods. IV. FIXED ASSETS : The fixed assets (other than livestock) are stated at cost, less accumulated depreciation (other than freehold land where no depreciation is charged). Livestock are stated at book value.

76 .... Consolidated Financial Statements

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V. METHOD OF DEPRECIATION AND AMORTISATION :

(i) Depreciation on Fixed Assets is provided : (a) By Indian Companies - on WDV/SLM method and at rates under the Companies Act, 1956. (b) By foreign subsidiaries - on methods and at rates permissible under applicable local laws or at such rates so as to write off the value of assets over its useful life. (ii) Cost of technical know-how capitalised is amortised over five years. (iii) Cost of Customised Software is amortised over a period of three to six years thereof. (iv) Cost of Trademarks acquired is amortised over a period of five years thereof. (v) Goodwill arising on consolidation is amortised over a period of ten years. VI. INVESTMENTS : Investments are classified into Current and Long-term Investments. Current investments are stated at the lower of cost and fair value. Long-term Investments are stated at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of Long-term Investments. However, fixed income long term securities are stated at cost, less amortisation of premium/discount and provision for dimunition to recognise a decline, other than temporary. VII. VALUATION OF INVENTORIES : (i) The inventories resulting from intra-group transactions have been stated at cost after deducting unrealised profit on such transactions. (ii) Goods in transit are stated ‘at cost’. (iii) Inventories are stated ‘at cost or net realisable value’, whichever is lower. (iv) Cost comprise of all costs incurred in bringing the inventories to their present location and condition. Cost formulae used are either ‘average cost’ or ‘specific identification’, as applicable. Due allowance is estimated and made for defective and obsolete items, wherever necessary, based on the past experience. (v) All the costs incurred on un-invoiced conversion contracts are carried forward as “Accumulated Costs on Conversion Contracts” VIII. FOREIGN CURRENCY TRANSLATIONS : For the purpose of consolidation, the amounts appearing in foreign currencies in the Financial Statements of the foreign subsidiaries are translated at the following rates of exchange: (a) Average rates for the incomes and expenditure. (b) The year-end rates for the assets and liabilities. IX. FOREIGN CURRENCY TRANSACTIONS BY INDIAN COMPANIES : (i) All transactions in foreign currency, are recorded at the rates of exchange prevailing on the dates when the relevant transactions take place; (ii) Monetary items in the form of Loans, Current Assets and Current Liabilities in foreign currency, outstanding at the close of the year, are translated in Indian Currency at the applicable rates of exchange prevailing on the date of the Balance Sheet. Resultant gain or loss is accounted during the year; (iii) In respect of Forward Exchange contracts entered into to hedge foreign currency risks, the difference between the forward rate and exchange rate at the inception of the contract is recognized as income or expense over the life of the contract. Further, the exchange differences arising from translation at the year end rate on such contracts are recognised as income or expense along with the exchange differences on the underlying assets/liabilities. Further, in case of other contracts with committed exchange rates, the assets/liabilities are accounted at the rate so committed. Profit or loss on cancellations/renewals of forward contracts is recognised during the year. In case of option contracts, the losses are accounted on mark to market basis. X. EMPLOYEE BENEFITS : Defined Contribution Plans such as Provident Fund etc., are charged to the Profit & Loss Account as incurred. Defined benefit Plans - The present value of the obligation under such plan, is determined based on an actuarial valuation using the Projected Unit Credit Method, Actuarial gains and losses arising on such valuation are recognised immediately in the Profit & Loss Account. In case o f funded defined benefit plans the fair value of the plan assets is reduced from the gross obligation under the defined benefit plans, to recognise the obligation on net basis. Other Long term Employee Benefits are recognised in the same manner as Defined Benefit Plans. Termination benefits are recognised as and when incurred. However, the termination benefits which fall due more than twelve months after the Balance Sheet are discounted using the yield on Government Bonds. XI BORROWING COSTS Interest and other borrowing costs attributable to qualifying assets are capitalised. Other interest and borrowing costs are charged to revenue. XII TAXATION : Income-tax expense comprises current tax and deferred tax charge or credit. Provision for current tax is made on the basis of the taxable income at the tax rate applicable to the relevant assessment year. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantively enacted by the Balance Sheet date. Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation. Minimum Alternative Tax credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal tax during the specified period. XIII IMPAIRMENT OF ASSETS: The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An asset is impaired when the carrying amount of the asset exceeds the recoverable amount. An impairement loss is charged to the Profit & Loss Account in the year in which an asset is identified as impaired. An impairment loss recognised in prior accounting periods is reversed if there has been change in the estimate of the recoverable amount. XIV. GOVERNMENT GRANTS: Grants received against specific fixed assets are adjusted to the cost of the assets and those in the nature of promoter’s contribution are credited to Capital Reserve. Revenue Grants are recognised in the Profit and Loss Account in accordance with the related scheme and in the period in which these are accrued. XV. USE OF ESTIMATES : The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Differences between actual results and estimates are recognised in the period in which the results are known/materialised. XVI. PROVISIONS, CONTINGENT LIABILITIES AND CONTIGENT ASSETS A provision is recognised when there is a present obligation as a result of a past event, that probably requires an outflow of resources and a reliable estimate can be made to settle the amount of obligation. Provision is not discounted to its present value and is determined based on the last estimate required to settle the obligation at the year end. These are reviewed at each year end and adjusted to reflect the best current estimate. Contingent liabilities are not recognised but disclosed in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statements.

Consolidated Financial Statements .... 77

The details of subsidiaries in terms of General circular No. 2/2011 Dated 8th February, 2011 issued by Government of India, CMYK

Ministry of Corporate Affairs under Section 212 (8) of the Companies Act, 1956, is as under: Table - A (Rs. In lacs) Indian Subsidiaries Foreign Subsidiaries

Signed this ..................... day of ..............................., 2012 Signature across Revenue Stamp

Notes: • The proxy, in order to be effective, should be duly stamped, completed and signed must be deposited at the Registered Office of the Company at Plot No. 156/H.No.2, Village Zadgaon, Ratnagiri – 415 612, Maharashtra, not less than 48 hours before the time of the meeting, • The proxy need not be a member of the Company. CMYK